Taking in a Lodger

bubbleoflife_2

I have to make some extra money quickly and taking in a lodger is the only way to do it, at the moment. So, I've thought of letting my bedroom, or sharing it, for not a lot mainly to help paying the bills.

Is it complicated? Do I have to have a contract or simply a rent book? Can I simply make a agreement with the lodger, take cash and keep a record of it?
Does taking in a lodger for help with bills come under the Rent A Room Scheme (£4,250 tax free)?

katejo

bubbleoflife wrote: »

I have to make some extra money quickly and taking in a lodger is the only way to do it, at the moment. So, I've thought of letting my bedroom, or sharing it, for not a lot mainly to help paying the bills.

Is it complicated? Do I have to have a contract or simply a rent book? Can I simply make a agreement with the lodger, take cash and keep a record of it?
Does taking in a lodger for help with bills come under the Rent A Room Scheme (£4,250 tax free)?

You don't have to have a contract though it is advisable. You can use the rent a room scheme (I do) but your total income has to stay below £4250. That includes contributions to bills (gas etc and council tax). How many bedrooms do you have? I doubt that a lodger would want to share a room. If you let the flat and move out, you can't use th rent a room scheme.

00ec25

SHARING your bedroom with a stranger :eek:

I assume you mean you have a property with at least a spare bedroom which you want to let not 1 bedroom that you want to share:p.

you need to do some reading - start with the direct gov website
http://www.direct.gov.uk/en/HomeAndCommunity/Privaterenting/RentingOutYourProperty/DG_189125
lodgers have few rights,
there is no set requirements for written agreements, you would be wise to write down how much and when rent is to be paid and you both sign that paper
- you agree (written better) house rules
- you start living together

you only need a rent book if he pays weekly but you must keep a record of payments recived for tax purposes (even if you don't actually pay tax, you've gotta be able to prove how much you got afterall)

Yes of course a lodger comes under the rent a room scheme - that's eaxactly and only what it applies to
if you charge more than £4250 pa, ie £354.16 rent per month (£81.73 per week) you MUST inform HMRC and you will pay Income Tax on the excess over 4,250(or you may do your tax the normal way: rent - eligible costs)
if he pays you a contribution towards "bills" , or pays you for anything else on top of the "rent" the total you get is the figure used for the rent a room scheme limit

G_M

LODGERS (Licencees)
A lodger (broadly) lives in the same property with their resident landlord, and shares facilities. Unlike tenants, lodgers have few rights.

The Housing Act 1988 (above) provides definitions of 'Resident Landlord' and 'same property'.

There is advice for landlords considering taking in lodgers here:

LodgerLandlord (General information site)

Landlordzone (General advice)

Rent a Room Scheme (Government info on tax-free income from lodgers)

Yorkie1

If you have gas in the property, make sure you get a LL's Gas Safety Certificate first.

bubbleoflife_2

00ec25 wrote: »

...
I assume you mean you have a property with at least a spare bedroom which you want to let not 1 bedroom that you want to share:p.
you need to do some reading - start with the direct gov website
http://www.direct.gov.uk/en/HomeAndCommunity/Privaterenting/RentingOutYourProperty/DG_189125
lodgers have few rights,
there is no set requirements for written agreements, you would be wise to write down how much and when rent is to be paid and you both sign that paper
- you agree (written better) house rules
- you start living together
you only need a rent book if he pays weekly but you must keep a record of payments recived for tax purposes (even if you don't actually pay tax, you've gotta be able to prove how much you got afterall)
Yes of course a lodger comes under the rent a room scheme - that's eaxactly and only what it applies to ....

Thank you for the information I'll do the bedside reading.

SuzieSue

Try easyflatmate.com or spareroom.co.uk. Both have worked for me.

bubbleoflife_2

Just wondered: does it have an effect on Child Tax Credits (NOT Working Tax Credits, which I'm not getting at the moment)?

Also, as I'm reading various info including the one here
http://www.direct.gov.uk/en/moneytaxandbenefits/taxes/taxonpropertyandrentalincome/dg_4017804

it reads:

'if you don't normally receive a tax return and your receipts are below the tax-free thresholds for the scheme, the tax exemption is automatic so you don't need to do anything.....'

Does this apply to one who does receive tax returns (I understand it as 'must fill tax returns') but tax receipts from letting are below the tax free threshold (£4250) ?

tommie1shunt

If it is sharing the same room and you look good in black lingerie, PM me.

bubbleoflife_2

tommie1shunt wrote: »

If it is sharing the same room and you look good in black lingerie, PM me.

That's a bit silly :mad: Many people share their bedrooms, i.e. friends, relatives, students. I'll be sharing my bedroom as I have to leave some of my stuff in it and sleep in my living room. Is that clearer???

00ec25

bubbleoflife wrote: »

Does this apply to one who does receive tax returns (I understand it as 'must fill tax returns') but tax receipts from letting are below the tax free threshold (£4250) ?

if you are required to do a tax return but your lodger income is below 4250 then you must declare the fact on your tax return by claiming the exemption whilst also completeing the relevant boxes on the rest of the return - you will remain exempt on that income but you must show it on the return