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steve99.9


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Self assessment -UK Property
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Hi

My client has a lodger in his home, He also has several properties which are rented to tenants

Can he claim rent a room relief for the lodging income as a separate item or does he have to  add it to the property rental income

Steve



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attilabenko


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Hi,

I seem to remember you don't pay tax after your lodging income (lodger in your home) but hopefully someone can confirm this.

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Attila
attilabenko


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It is the so called rent a room scheme (you get an allowance for some of the income)
Have a look at this, hope it helps:

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_4017804

-- Edited by attilabenko on Tuesday 31st of August 2010 09:15:06 PM

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Attila
Merlion ABS


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As long as the rent a room gross income (ie rent paid) does not exceed the yearly allowance, then you dont have to declare it.

But this has to be on their only or family home. Family home being the key point here as he has other residential letting properties.

I would have thought that he does not need to disclose the income under the rent a room scheme.

Best to get further advice from a qualified tax specialist. a Chartered Firm of Accounts should be quite happy to answer a general query on this.

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BackOfficeGroup


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Steve

If the gross income is less than £4250 then you will not have to pay any tax, so long as the room is in your main residence - if jointly owned then £2125. You still have to put an 'X' in a box on the SA return.

You can opt out of the rent a room scheme, if for example you have made a loss.

If you have income over £4250, then you will have to pay tax in the normal way.

P

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steve99.9


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Hi

Thanks to all for your help

I had a quick word with an accountant friend and he confirmed what you guys are saying

P - Just for further clarification ( I forgot to ask my friend this.) You say that I should cross box 4 on the property supplement. Presumably this means that I should add the rent a room income to the general property income and put the whole lot in Box 18 Then net off the exempt amount in box 35. is this correct

Again many thanks to all who replied


Steve



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BackOfficeGroup


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Steve

If the income is less than the 4250, then you only place the 'x' in the box to tell HMRC that you have rent a room income which is less than the threshold. You would not show the actual income anywhere.

If you have more, you just add to the total income and it is taxed in the usual way - I don't think you tick the box if the income is more.

P

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