UK Landlord Forum / Life

relative novice and first post-
agent had lined up a potential tenant who is a self employed chef- what are the pitfalls of having someone who is self employed as a tennant?

context- male, single parent and 2 young children

many thanks in advance

There's nothing wrong with being self employed versus being employed. I'd want to see a lot of bank statements!

As JPK says no problem with Self Employed

You could ask them to get their accountant to provide a financial statement.

Any Tenant is at risk of losing their job, income, customers.

When you have a single parent who does not have custody of their kids it can be an issue, if they lose their income and apply for housing benefit the DWP will NOT pay for the second or third bedroom.  They look at the father only, determine they only NEED one bedroom and pay them the appropriate level of LHA rent for the postcode of the property.

So if a LHA rates were £1000 for one bedroom, £1500 for 2 bedroom and £2000 for 3 bedroom they would only get the £1000 so have increasing arrears every month.

It is different for a female single parent who has custody, they not only get the appropriate level of LHA (subject to rules on kids sharing bedrooms subject to age and sex) but they have plenty of supplement benefits (subject to a benefits cap).

As I said bad times can happen to anyone, it is just that a self employed person is less likely to have cashflow depending on what sector they are employed in.  During the 2008 financial crisis I had a client take their own life in these circumstances.   

If your Tenant has custody of these two young children it is going to be quite hard for them to work full time, it really depends on the job.  I know a banker earning over £250k who works 4 days a week at home and juggles parenthood after losing his wife to cancer, so it can be done if the person is organised type.

Quote from: georgem on January 11, 2025, 07:11:03 PMrelative novice and first post-
agent had lined up a potential tenant who is a self employed chef- what are the pitfalls of having someone who is self employed as a tennant?

context- male, single parent and 2 young children

many thanks in advance

Too many decent employed people out there to risk someone who's self-employed (and yes, Im self-employed).

Chefs used to be able to walk down the high street and get 10 jobs - but the restaurant is struggling with many places closing down - personally, I wouldnt risk my rent being a part of that industry at present