not paying rent with £10000 grant

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    #16
    Hi K.Brown I work on free heating and insulation grants and know that if the grant is not used for the correct purpose then the claimant is liable as he is committing fraud . The regulating body or issuing local authority in this case would be very intrested in knowing that this person has claimed the small buisness grant and has used the funding to pay off personal obligations . The fact that he is refusing to pay you in full is utterly disgraceful . This money has come from the public purse to help buisness survive through lockdown , This person will also be claiming Furlogh so there should be no reason for him not to pay his rent . I would suggest that you inform him if he dose not pay in full that you will report them to the local council that has processed the £10,000 small buisness grant , tell them you will notify the council of their refusal to pay rent and the reason he has given ( paying off personal obligations ) he will end up paying the full amount back to the council or be issued with winding up proceedings .

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      #17
      I would still let the Local council know as they are not just taking the preverbial out of you K.Brown they are also stealing public funds.

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        #18
        a new problem has occurred I have the tenants end date is 13th june he has left the shop in an ok state so am looking at returning his deposit and recieve keys and shutter remote back BUT he has indicated he will only return one key fob as he bought the other himself so belongs to him he also has a spare key he bought so doesnt want to return that !obviously I dont want to have to change all locks and have to reprogram shutter ready for new tenant .I've never had this situation before any thoughts ?

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          #19
          Pay him for the key, or charge him for changing locks, surely?

          (Not sure why anyone would want to risk old tenant continuing access, anyway.)

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            #20
            Its always a good idea to change cylinders between lettings. Who knows who else may have a set of keys. I have a box of them and rotate

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              #21
              We have had quite a few tenants who have taken the grant money and stuck it in their pocket effectively putting up a V sign at us. One of them is the long established betting shop business with hundreds of branches whose parent company is listed in the FTSE250 Without wanting to name names we issued summonses on moneyclaim online, served at the registered office and made sure they came to the attention of the Board by messaging a copy of the proceedings to the Chairman via LinkedIn. All paid off now. If you have a tenant who hasn't paid you rent but who was entitled to a grant I would recommend you sue them for at least half of what they owe you. You want them to be able to afford to settle the claim rather than actually to have to go to a hearing.

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                #22
                Originally posted by rentreviewspecialist View Post
                As I understand, he can do what he likes with the grant. It would be treated as revenue for the business and is taxable.
                A business only needed to be eligible for small business rates relief on the 11 march 2020 to automatically recieve the grant.The policy intention would have been for that money to be used to help the business through this period, but it would be up to he individual how to allocate this.In some cases it may be prudent to hibernate for a while, rather than pay rent on an unused premises if they have a flexible monthly licence;certainly many office based business worldwide are doing that at the moment.In some cases the cash may be needed to pay for stock, other debts etc etc.There was no stipulation that the grant should be used exclusively for rent.But yes of course in lots of cases at least part would be probably used for rent.

                Genuine fradulenty activity in this area would be when a business or individual somehow managed to get hold of the grant funds, while not actually being a genuine small business rates payer, or an individual using the details of a genuine ratepayer to fradulently obtain the funds.

                While very welcome the grants may have been a drop in the ocean for some trades and professions, partciulary ones that make 90 percent of their profits in the four summer months.Imagine if you rented a unit to store marquee equipment for weddings, and you had just spent £50,000 on new equipment with the expectation of making it back during the wedding season.With all that work possibly gone for the entire year, its easy to see how such a company could still fold or struggle to pay rent depsite the grant... I dont think its fair to then accuse them of fraud as well!

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                  #23
                  Yes, how one uses the grant money is entirely discretionary, but its purpose is to 'replace' any income the business in question might have reasonably expected to earn (well, up to £10k of course!), out of which the business owner would then have paid their business expenses. But if the rent money is part of their normal outgoings, then it has to be one of the purposes at least of the grant money.

                  However, the issue in this case is not so much whether the tenant prioritised rent paying over paying other normal expenses, but that he seems to have closed his business altogether! (ie, left the business premises).

                  This then might be fraud, in that the purpose of the grant is to keep a business going, not to let a business owner help themselves to £10 of 'free money' and then shove off with it! That's the reason I've suggested at the least letting the council know what the tenant has done - it's up to the council then to decide whether the grant money needs to be repaid, because the business owner's circumstances have changed (ie, he's closed down his business!) (HAS he? eg, is he 'trading from home' but no longer renting, etc?)

                  'Shopping' his former tenant to the council over the potential non-elibilitity of the grant (ie, because the business no longer exists), maybe not get the OP/landlord his rent money back, but it might make him feel somewhat better about his non-paying cleared-off tenant!

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                    #24
                    Lizbeth, perhaps you could provide a link to the grant legislation or govt eligibility that stipulates that a business must reopen for a minimum of x months or even reopen at all to be entitled to keep the grant money? If not I'd kindly suggest that you're talking utter nonsense.

                    Of course I totally agree with your logic here, yes the grant should have been paid to people only who have say a minimum of x months remaining on their lease or paying a smaller sum to landlord's with empty shops who won't be able to find a tenant.
                    ​​

                    ...BUT NO the stupid govt will pay grant to someone who had already served their notice to leave prior to March and who's lease ends by 31st March 2020 providing they were still in occupation at 11th March!! A nice £10k bonus for someone retiring from the shop anyway, while the landlord is then stuck with an useless property that cannot be rented during lockdown and they receive zilch!

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                      #25
                      As to the OP, just deduct locks and outstanding rent from the deposit and good riddance to em.
                      ​​​

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