Renting rooms out - advice guides??

Mojisola

I had googled - it's a shame the government site isn't clearer - no mention of lodgers, only tenants, and no mention of live-in LL.

https://www.gov.uk/house-in-multiple-occupation-licence
A house in multiple occupation is a property rented out by at least 3 people who are not from 1 ‘household’ (eg a family) but share facilities like the bathroom and kitchen. It’s sometimes called a ‘house share’.

https://www.gov.uk/private-renting/houses-in-multiple-occupation
Your home is a House in Multiple Occupation (HMO) if both of the following apply:
at least 3 tenants live there, forming more than 1 household
you share toilet, bathroom or kitchen facilities with other tenants

gazter

Mojisola wrote: »

I had googled - it's a shame the government site isn't clearer - no mention of lodgers, only tenants, and no mention of live-in LL.

https://www.gov.uk/house-in-multiple-occupation-licence
A house in multiple occupation is a property rented out by at least 3 people who are not from 1 ‘household’ (eg a family) but share facilities like the bathroom and kitchen. It’s sometimes called a ‘house share’.

https://www.gov.uk/private-renting/houses-in-multiple-occupation
Your home is a House in Multiple Occupation (HMO) if both of the following apply:
at least 3 tenants live there, forming more than 1 household
you share toilet, bathroom or kitchen facilities with other tenants

When its not clear, be absolutely clear its not clear for a reason, ie they are making it up. Its within the nature to always fall on the side that gives a body maximum authority.

I understand excluded occupiers come to join your household, not create new ones.

If it aint clear, it aint true.

Talc1234

gazter wrote: »

I understand excluded occupiers come to join your household, not create new ones.

If they aren't related to you and you are not sleeping with them then they are considered to be separate households.

booksurr

gazter wrote: »

I understand excluded occupiers come to join your household, not create new ones.

rubbish, statute law has always been perfectly clear on what constitutes a household

http://www.legislation.gov.uk/ukpga/2004/34/section/258

booksurr

cameron99999 wrote: »

Hi all,

I am in the process of buying a 3 bedroom flat which i will be living in. However i plan to rent out the other two rooms and am looking for advice on regulations paying tax etc.

OP , if you have 2 (or more) lodgers who are not living together as one couple, then the tax implications are:

income tax: if you choose the rent a room scheme you will get £4,250 pa total rent tax free, you will pay tax on anything in excess of that , eg: receive 4,500 rent you will pay tax on 4500 - 4250. If you choose the rar scheme you cannot claim any costs at all against the rent , that is why you get a tax free sum!
if you choose the "normal" method: rent - costs = taxable profit then you will need to apportion your costs to include the fact that some of them relate to your personal living expenses

cgt, if you have 2 or more lodgers you lose the 100% exemption from CGT and will need to calculate CGT on the basis that you can claim letting relief instead. There is no apportionment allowed on CGT, ie you cannot claim 1/3 as yours and 2/3 as theirs, it is either all liable or all exempt for CGT. Letting relief is however pretty generous and means it is unlikely you will actually have to pay any tax, although you will be liable with 2 or more lodgers