IHM Charges That Survive Audit (And Those That Won't)

Intensive housing management (IHM) charges are under attack. Local authority audit teams have learned to scrutinise these charges with forensic attention, and many providers are discovering that what they thought were legitimate eligible charges do not survive examination.

The stakes are high. IHM charges often represent a significant proportion of a provider's housing benefit income. When they are disallowed, the financial impact can be severe—and the recoupment demands that follow can threaten organisational viability.

What Makes IHM Charges Defensible

The Housing Benefit Regulations permit eligible service charges for "intensive housing management" where the accommodation is provided by a registered housing association or exempt charity. But the regulations do not define what "intensive housing management" means in practice. That definition has emerged through case law, guidance, and local authority interpretation—not always consistently.

The question is not whether you provide housing management services, but whether those services are genuinely "intensive" in the regulatory sense.

Charges that typically survive audit include:

• Welfare and benefit liaison that goes beyond standard landlord duties
• Resettlement support for new residents
• Liaison with support agencies and health services
• Enhanced tenancy management for vulnerable residents
• Anti-social behaviour management requiring intensive intervention

The common thread is that these activities exceed what a standard landlord would do for a standard tenant. They are housing management activities, but they require additional intensity, skill, or time investment because of the nature of the resident group.

What Falls Under Audit

Charges that frequently fail scrutiny include:

• Vague or poorly defined service descriptions
• Charges that duplicate care or support services
• Administrative overheads repackaged as IHM
• Services that would be provided to any tenant regardless of vulnerability
• Charges with no clear methodology for calculation

The last point is critical. When auditors ask "how did you calculate this charge?" the answer must be defensible. A charge of £150 per week for "intensive housing management" invites questions about what activities that £150 represents, how many staff hours, what specific outcomes. If the answer is essentially "we picked a number that seemed reasonable," the charge will not survive.

Building Audit-Proof Charges

The providers who weather audits successfully are those who can demonstrate a clear methodology. They can show:

• A written service specification for each IHM activity
• Staff time records showing who delivers each service
• A costing model that links staff time to charges
• Evidence that the activities are actually delivered as described
• Differentiation from care, support, and supervision (which may be eligible under different categories)

This level of documentation is laborious. But it is the price of defensible charges. Providers who cannot demonstrate their methodology will see their charges reduced or eliminated—and may face demands to repay years of "overpayments."

When Charges Are Challenged

If your IHM charges are challenged, do not assume the auditor is correct. Request the detailed basis for their conclusions. Ask for the criteria they have applied. In many cases, auditors apply informal guidance or local policy that may not align with the regulations or case law.

Consider whether an appeal is warranted. First-tier Tribunal decisions on IHM charges have gone both ways, and a well-documented case can succeed even where the initial audit was unfavourable. The key is documentation—if you have it, use it; if you do not, start building it now.