Rent a room relief

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Rent a room relief can exempt from tax up to £7500 of income per year.  That’s a lot of tax free income available.  But of course you have to put up with a lodger!  Some tips around rent a room relief:

You don’t have to own your home to claim it – if you have a lodger in your rented home you still qualify for rent a room relief.

You can use the exemption against AirBnB type income.

You have to live in the house where the income is generated, so it can’t be used to exempt income from an annex.

For the same reason, you can’t exempt income from house swap situations.

The exemption only applies to residential lets, it does not exempt income for letting a room as an office.

You do have to declare the income on your tax return, and claim rent a room relief.

It can apply to multiple lodgers and multiple rooms, as long as the lodgers are living in your home.

As with all of our tax tips and web pages this information is necessarily summarised and of a general nature.  If you would like detailed specific advice please contact us.