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What is a DSS tenant? What landlords need to know about renting to tenants on benefits

2-minute read

What is a DSS tenant? What landlords need to know about renting to tenants on benefits
Josh Hall

Josh Hall

19 October 2017

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Across online letting agency websites you’ll sometimes see the phrase ‘no DSS’. But what does it mean, and what do landlords need to know?

The phrase ‘DSS tenant’ refers to the Department for Social Security, an old government department that was, in the past, responsible for benefit payments.

But the phrase has endured, and ‘no DSS’ is now used to show that the landlord is not willing to rent a property to tenants in receipt of benefits like Housing Benefit or Universal Credit.

So what happens if you choose to accept tenants in receipt of benefits? What are the implications for landlords?

Renting to DSS tenants

Landlords can sometimes be nervous about tenants on low incomes, and many fear that those on benefits may fail to keep up on rent payment. However, there are legal safeguards in place in the event that a tenant in receipt of Housing Benefit goes into arrears.

In these cases, provided the arrears are at least eight weeks, you can request that the local authority pays the benefit directly to you, rather than to the tenant. The local authority will then adjudicate, and is likely to rule that the money should be paid to you unless there is an overriding reason why this is not in the tenant’s best interest, for example if there is an ongoing dispute over repairs.

Legally, there's nothing to stop you renting a property to DSS tenants. All the terms of a tenancy agreement remain the same and you're not required to provide anything extra.

Landlord insurance for DSS tenants

If you’re worried about your insurance position when it comes to DSS tenants, you should note that most insurers now cover rental agreements made with such tenants as standard.

The majority of insurers available through Simply Business will provide a quote to cover DSS tenants, but if you’re in any doubt make sure you contact your insurer directly.

You can find out more about what type of landlord insurance you need in our landlord FAQ section.

Should I rent to DSS tenants?

Whether or not you rent to DSS tenants is of course up to you, but if you’re unsure, it’s worth remembering that there is recourse available to you in the event that the rent isn’t paid.

In addition, in areas with lower rental demand, opening up your property to more prospective tenants can be a great way to reduce void periods and tenant turnover.

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We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer

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