Lodgers? Hidden costs?

lynzpower

Hi there

Ive had lodgers ( well mates of mine really) whove moved in to my spare room. Theyve rented it at 450 a month part inclusive, unfurnished. ( im not meant to have anyone else stay here apart from me as per my lease, so my mates have been "staying here temporarily" if the housing association ask)

Anyway, I have another freind that is considering moving in. Im furnishing it with the bare minimum ( second hand bed, cheap ikea drawers,we have a wardrobe already, seeing what else is on freecycle lol) I'll charge her maybe less as we really want to make it attractive for her, some income is better than nothing!

Anyway. I was wondering, what are the hidden costs for having a lodger? Does it radically change the bills? Anything else i need to be aware of ( my contents insurance is rigged up fine for a lodger)

Cheers
lynz
xx

Bargain_Rzl

If you're currently getting a 25% single person discount on your council tax then this will no longer be valid.

Make sure that she pays for any chargeable phone calls.

If you don't mind me asking, why are you going against the terms of your lease? Surely the biggest hidden consequences are right there, if you get found out?

lynzpower

Im going against the terms of my lease as im skint basically, and need the income.

Im in shared ownership so in fairness they cant evict me or anything, ive checked the lease

Cheers for that xx

skintchick

I haven't found my bills have gone up really - you have to heat the house anyway. You will use more water, and of course you have to heat that, but it seems minimal, and they are paying rent that covers it of course!

As long as you keep food separate you'll be fine.

But in your case there's a big problem - you have to tell the council tax peeps to take your discount off, which provides a paper trail that your landlords (or whatever they are called in your circumstances can pick up on.

I'm not sure it is worth the risk of it all TBH

lynzpower

Oh I dont have single persons discount, my partner lives here as well anyway

GingerSte

Whilst I obviously cannot recommend you going against the terms of your lease, I can explain some of the pros and cons of renting out a room. This list is by no means exhaustive, but was cobbled together during my lunch break. If I remember, I may add to this list.

Pros...Extra money for paying off those peshy debts
Someone else to help with washing up (some of the time)
Cooking for two every other night is easier than cooking for one every night, so the temptation for takeaways is reduced.
New batch of cd's, vidoes, dvd's to listen to / watch
Someone else to help with washing up (after a hard days' moneysaving you'll really appreciate this, so I've mentioned it twice).
Savings can be made on weekly shop by buying together.

Cons...
One less room for you and your things.
Walking around house sans clothes is a definite no no.
Sharing the bathroom.
Inconsiderate lodgers.
Chasing up lodgers when they don't pay.

Good use of ground rules and a good choice of lodger should help reduce most of the cons AND REMEMBER to keep anything private and confidential out of their way.

Most of all, have fun and enjoy the extra dosh.

skintchick

Personally, I keep food separate. You may not agree on how to spend it.

lynzpower

thanks a lot for this. Much of it wont apply as its someone we already know and like a lot, but agree wholeheartedly about the nudeness!!

Thanks for this.

With the last lodger ( also a v close freind) we were then putting in £100 a month for food & household cleaners bin bags etc. I think this was too high, but a fixed amount to spend helped us all a lot. Now being so MSE i'll be saying £50 per month each hehe

exil

No one's mentioned tax (income tax I mean) yet, so I will. TAX. Rent counts as taxable income, though you can deduct expenses.

skintchick

No it doesn't - the Government's rent a room scheme allows you to do it tax free.

Will go away and get info...


http://www.direct.gov.uk/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/TaxOnRentalIncomeArticles/fs/en?CONTENT_ID=4017804&chk=mGasop

long link!!!

exil

Only if you register with the scheme. And there's a limit (80-ish a week - which is less than 450 a month).