Rent A Room - what happened to the MSE campaign?

scarletjim

When I Google 'Rent A Room' I see that MSE campaigned a couple of years ago to have this allowance raised, as it has been static at £4,250 for about 15 years, which is grossly unfair as rents have risen. Does anyone know what happened to this campaign? Has it been 'given up on'?

Does anyone think it's worth raising it again? I for one would certainly consider renting out another room in my house if this allowance was raised... I've never spoken to the government about anything, where would I start, my local MP?

poppysarah

Would you like lodgers to pay more?

That's not very money saving for them!

scarletjim

What? No, the 'Rent A Room' scheme is a tax allowance against rental income if you rent a room out. If you rent out multiple rooms, you can elect for the whole income combined to be treated under the scheme (well it seems so anyway). So could rent out another room without having to pay 40% of the additional income in tax!

00ec25

Indeed the 4250 pa allowance is rather old, but now is hardly the time for HMRC to increase tax free allowances. Look at all the complaints about the 40p / 25p mileage rate given petrol prices.

It is not about giving a tax free "income" - the allowance simply represents an estimate of the costs whoich would probaly be claimed under the normal method (income less eligible costs = taxable profit) in the first place and so would be tax "free" as they are valuid deductions.

The principle behind the allowance is to save HMRC and the tax payer the admin expense of having to do a tax return where, in all probability, the tax payer would have very little profit if they used the normal method and therefore little or no tax to pay. So removing the need to do the full calculation simplifies it for both parties.

The allowance refers to the total income – it is not an allowance per room or per lodger. If you have one lodger who pays more than 4250 pa (354 pcm) then you have to pay tax on the excess. Similarly if you have 2 or more lodgers/rooms let out which brings in more that that in total

Life is just not fair!

scarletjim

Yes I see your point and I seee the point of them having it, but as MSE was campaigning to have it increased a couple of years ago I was hoping that campaign might be resurrected, solely for my own selfish benefit lol