Income from rent

huddsta

Hello all

I'm applying for a mortgage on my first home. It will be a sole application but as my O/H will be living with me, can I put down rental income from her as a way of increasing the amount I can borrow?

If so, what amount can I charge before paying tax?

Thanks

Ian_W

You really need to re-post this on the mortgages and endowments thread which is towards the top of the page listing the threads. It has been asked before, or at least questions about lodgers have, and from memory I think the general concensus was that lenders won't take it into account but do ask there as I may be wrong.

You can earn £4250 on the "rent a room" scheme before paying tax. There's an explanation at:
https://www.direct.gov.uk/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/TaxOnRentalIncomeArticles/fs/en?CONTENT_ID=4017804&chk=mGasop

stevo84_2

i recently got a morgage from a+l through a broker for 94k. im on 15k a year and they added in the 3.5K i was getting from the room. the broker probably helped as theres no where on the a+l site to add this in. Would advise speaking to a broker and seeing if they can do this for you.

stevo84_2

Ian_W wrote:

You really need to re-post this on the mortgages and endowments thread which is towards the top of the page listing the threads. It has been asked before, or at least questions about lodgers have, and from memory I think the general concensus was that lenders won't take it into account but do ask there as I may be wrong.

You can earn £4250 on the "rent a room" scheme before paying tax. There's an explanation at:
https://www.direct.gov.uk/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/TaxOnRentalIncomeArticles/fs/en?CONTENT_ID=4017804&chk=mGasop

just a quickie. If I rent my room for £4250 a year, can I claim tax relief on half of my bills including insurance, heating, lighting etc?

cheers
steve

Chrismaths

No. This is gross income. If you want to claim costs you have to go the full property accounts method, and pay tax.

Edit: Of course you OH could just pay her half of the bills...

stevo84_2

ah cheers chrismaths, I dont think it would be worth me opting out of the scheme then!

thanks
steve