she would have to declare another adult in the house, which would definitely affect her Council Tax benefit, and perhaps her Housing benefit. she would have to declare your rental income which would affect any benefits she receives.
if you claim any benefits you would have to declare your rental income to where ever your benefits come from, and they would most likely be reduced or cease altogether. you would have to declare that you are renting your property to your mortgage lender (unless you own outright).