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Renting Out A Room?

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The amount which can be received tax free from renting out a room or rooms in your only or main residential property, is set to increase from £4,250 to £7,500 per year – that’s £625 per month tax free! This scheme is designed for individuals who rent out furnished residential accommodation in their only or main home. This would apply to a lodger for example.

The increase to the rent-a-room limit will apply from 6 April 2016 and covers any amount received as rent and payment for services (laundry, shopping, cooking etc.) together with any payments made for any provision of food or heat and light.

The level also increases if you rent out rooms in a guest house, Bed & Breakfast or similar, providing that it is your own main residence.

The exemption is halved if the room being rented out is in a property in joint ownership.

Under the Rent a Room scheme the home owner cannot claim any expenses to be set off against the rental income.