Lodger, maximizing the money they can give us without having to do taxes

Marvel1

antrobus wrote: »

Don't worry, you can't just put someone on the deeds. The someone has to consent and sign the transfer form.

Problem is they may not be aware of the implications.

Lloyd90

As far as I am aware, you do not have to declare lodger income if under the threshold.

I hve wondered how would HMRC know the difference between two people renting a room, one of them earning £7000 a year (owing nothing and not needing to declare it) and someone earning say £8000 a year (needing to do a self assessment tax return and pay tax).

How would they even know? Especially if someone didn’t normally complete self assessment returns.

Crashy_Time

G_M wrote: »

22 replies and counting.

This is a moneysaving website and so, yes, people here tend to support or suggest ways to save money.

But those 22 replies are all pretty unanimous in their opinion that what you are proposing are illegal ideas, or detrimental to your kids, or similar.

Not good ideas I'm afraid.

Except when it comes to buying property, which I have always found really weird :rotfl:

snowqueen555

The tax would be anything over £7500, seems to me to just pay the small amount of tax?

Saying that, I have lived in many places where the landlord certainly doesn't file any taxes.

Lloyd90

Snow queen - as I have read If they earn under £7500 (although less historically) they don’t have to file tax returns. Especially if PAYE.

Lloyd90

Snow queen - as I have read If they earn under £7500 (although less historically) they don’t have to file tax returns. Especially if PAYE.

Crashy_Time

snowqueen555 wrote: »

The tax would be anything over £7500, seems to me to just pay the small amount of tax?

Saying that, I have lived in many places where the landlord certainly doesn't file any taxes.

How would you know for sure though?

Honeylife

needabed wrote: »

You all seem to love paying taxes... I'm just looking for legal ways to reduce my taxes...

The rent a room scheme has a purpose; to provide accommodation as there is a shortage of accommodation particularly for young working people. To occupy spare rooms and to recompense the Resident Landlord reasonably for same. A great deal of research went into implementing it and it is still being monitored. It took years of lobbying to get the tax free allowance to be raised from £4500 to £7500 in 2016! Its not perfect and there are always those who find loopholes to exploit the system.

Paying tax to HMRC is what keeps the infrastructure of this country functioning relatively smoothly. We dont know what part of the country you live in, but £625pcm is a fair income tax free and it doesn't matter what your other earnings are that £7500 is quite secure. Rent your spare room above this sum per annum and you can claim for some expenses incurred, you can even claim for an accountant if you use one to assist you with filling the tax form. An alternative is if you think your room is worth more than £625pcm then rent it out for a shorter period per annum e,g, 6 - 9 months for say £800pcm.

A word of warning. There have been several disgruntled lodgers on this site asking if they should and how they could report their Landlord to HMRC as they suspect them of not paying either any tax or the correct tax. Now the HMRC have a duty on the publics' behalf to investigate these reports. So be careful. Do the right thing.

csgohan4

OP is entitled and thinks they shouldn't pay their share of tax.

OP i hope you don't need care in the future, guess how it's funded