Can lodger work from home?

1404

FreeBear said:

pieroabcd said:

1404 said:

I've actually decided in the last couple of days that when one of my two lodgers leave I won't be replacing them. Will have one lodger and earn less than the £7500 a year. I've grown weary of the worry about compliance and the requirement to complete a self assessment tax return each year. I will also be able to build up some PRR months just in case I need them when it comes time to sell. 

I think that you will still need to file the self assessment each year as long as you have a lodger.

May need to file a self assessment depending on earnings. Just because one earns up to £7500 under the Rent a Room scheme does not mean a self assessment has to be filed. Ran through all the questions here, and even with <£7500 from a lodger, I don't have to file any paperwork.

To have to do a self-assessment tax return for one lodger you'd need to charge them more than £625 per month.  I guess some lodgers do pay more, but for a room in someone's house that should cover it.  It more than covers my rooms.

pieroabcd

FreeBear said:

pieroabcd said:

1404 said:

I've actually decided in the last couple of days that when one of my two lodgers leave I won't be replacing them. Will have one lodger and earn less than the £7500 a year. I've grown weary of the worry about compliance and the requirement to complete a self assessment tax return each year. I will also be able to build up some PRR months just in case I need them when it comes time to sell. 

I think that you will still need to file the self assessment each year as long as you have a lodger.

May need to file a self assessment depending on earnings. Just because one earns up to £7500 under the Rent a Room scheme does not mean a self assessment has to be filed. Ran through all the questions here, and even with <£7500 from a lodger, I don't have to file any paperwork.

I stand corrected.

1404

FreeBear said:

pieroabcd said:

1404 said:

I've actually decided in the last couple of days that when one of my two lodgers leave I won't be replacing them. Will have one lodger and earn less than the £7500 a year. I've grown weary of the worry about compliance and the requirement to complete a self assessment tax return each year. I will also be able to build up some PRR months just in case I need them when it comes time to sell. 

I think that you will still need to file the self assessment each year as long as you have a lodger.

May need to file a self assessment depending on earnings. Just because one earns up to £7500 under the Rent a Room scheme does not mean a self assessment has to be filed. Ran through all the questions here, and even with <£7500 from a lodger, I don't have to file any paperwork.

I think what you mean is "BECAUSE with <£7500 from a lodger, I don't have to file any paperwork"?

Bookworm105

1404 said:

I've actually decided in the last couple of days that when one of my two lodgers leave I won't be replacing them. Will have one lodger and earn less than the £7500 a year. I've grown weary of the worry about compliance and the requirement to complete a self assessment tax return each year. I will also be able to build up some PRR months just in case I need them when it comes time to sell. 

but you will still have one lodger and therefore will not be building up PRR time, you will simply be reducing the % of the property subject to CGT
CGT applies just the same to to one lodger as it does to two. Lettings relief exists to cushion that exposure - as already mentioned 

1404

Bookworm105 said:

1404 said:

I've actually decided in the last couple of days that when one of my two lodgers leave I won't be replacing them. Will have one lodger and earn less than the £7500 a year. I've grown weary of the worry about compliance and the requirement to complete a self assessment tax return each year. I will also be able to build up some PRR months just in case I need them when it comes time to sell. 

but you will still have one lodger and therefore will not be building up PRR time, you will simply be reducing the % of the property subject to CGT
CGT applies just the same to to one lodger as it does to two. Lettings relief exists to cushion that exposure - as already mentioned 

I think one lodger doesn't count. Still get PRR for their room:

"If you’ve a single lodger, the rooms occupied by the lodger qualify for relief."

https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief-2021 

1404

mybestattempt said:

1404 said:

Emily_Joy said:

subjecttocontract said:

It seems that HMRC haven't moved with the times. WFH is the new normal for a large proportion of working age people AND surprise, surprise they WFH during the daytime. I guess HMRC might eventually get around to understanding how the new world order operates ! Although I wouldnt expect to much to soon.

I am actually a little confused now. Occasionally I work from home - for instance, if I need to finish important job-related paperwork I prefer to stay at home till it is done because there are less distractions than at workplace. Do I need to tell my landlord?

If your landlord uses Rent A Room Scheme for your rent then you can only work from home in the evenings and weekends.

If your landlord doesn't use Rent A Room Scheme, and instead pays tax on your whole rent (and claims expenses against it) then you can work during the weekdays.

That seems to be the situation.

It isn't the situation at all.

A lodger working at home occasionally during daytime hours would be viewed by HMRC in the same way as a lodger working at home on evenings and/or weekends.

I would add that lodger has no need or responsibility to become involved in the landlord's tax affairs.

And a landlord has the right to remove a lodger at any time giving them only reasonable notice.  The power is not with the lodger.

newsgroupmonkey_

1404 said:

Emily_Joy said:

1404 said:

mybestattempt said:

1404 said:

mybestattempt said:

1404 said:

Emily_Joy said:

subjecttocontract said:

It seems that HMRC haven't moved with the times. WFH is the new normal for a large proportion of working age people AND surprise, surprise they WFH during the daytime. I guess HMRC might eventually get around to understanding how the new world order operates ! Although I wouldnt expect to much to soon.

I am actually a little confused now. Occasionally I work from home - for instance, if I need to finish important job-related paperwork I prefer to stay at home till it is done because there are less distractions than at workplace. Do I need to tell my landlord?

If your landlord uses Rent A Room Scheme for your rent then you can only work from home in the evenings and weekends.

If your landlord doesn't use Rent A Room Scheme, and instead pays tax on your whole rent (and claims expenses against it) then you can work during the weekdays.

That seems to be the situation.

It isn't the situation at all.

A lodger working at home occasionally during daytime hours would be viewed by HMRC in the same way as a lodger working at home on evenings and/or weekends.

I would add that lodger has no need or responsibility to become involved in the landlord's tax affairs.

Your post didn't mention the Rent A Room Scheme. That's the key part. Under Rent A Room is the requirement to limit work to evenings and weekends. We've covered this quite a lot on this thread. And the wording of the guidance has been provided.

I'm fully aware of the guidance, I believe I provided the link to it earlier in  the thread.

There is no hard and fast rule in the legislation which determines which days of the week or specific times of the day a genuine lodger renting residential accommodation in a landlord's home is working from home for the rent a room method to apply or not.

Tell that to the person on this thread who lost their Rent A Room Scheme access because of lodger daytime working.

Assuming you are correct - how the landlord is supposed to know what kind of stuff the lodger is doing on their laptop?

I'm just quoting what someone said on page 5 of this thread.  

So, someone who registered, posted 3 times on this thread, left 9 days ago and hasn't been seen since.

Right, I'd absolutely be trusting that person.

If you'd Googled this, you'd see it's a common thread and people seem to think that working from home, whilst not running a business, isn't quite what the idea was back in 2006 when the guidance was last updated and few people hybrid worked.

1404

newsgroupmonkey_ said:

1404 said:

Emily_Joy said:

1404 said:

mybestattempt said:

1404 said:

mybestattempt said:

1404 said:

Emily_Joy said:

subjecttocontract said:

It seems that HMRC haven't moved with the times. WFH is the new normal for a large proportion of working age people AND surprise, surprise they WFH during the daytime. I guess HMRC might eventually get around to understanding how the new world order operates ! Although I wouldnt expect to much to soon.

I am actually a little confused now. Occasionally I work from home - for instance, if I need to finish important job-related paperwork I prefer to stay at home till it is done because there are less distractions than at workplace. Do I need to tell my landlord?

If your landlord uses Rent A Room Scheme for your rent then you can only work from home in the evenings and weekends.

If your landlord doesn't use Rent A Room Scheme, and instead pays tax on your whole rent (and claims expenses against it) then you can work during the weekdays.

That seems to be the situation.

It isn't the situation at all.

A lodger working at home occasionally during daytime hours would be viewed by HMRC in the same way as a lodger working at home on evenings and/or weekends.

I would add that lodger has no need or responsibility to become involved in the landlord's tax affairs.

Your post didn't mention the Rent A Room Scheme. That's the key part. Under Rent A Room is the requirement to limit work to evenings and weekends. We've covered this quite a lot on this thread. And the wording of the guidance has been provided.

I'm fully aware of the guidance, I believe I provided the link to it earlier in  the thread.

There is no hard and fast rule in the legislation which determines which days of the week or specific times of the day a genuine lodger renting residential accommodation in a landlord's home is working from home for the rent a room method to apply or not.

Tell that to the person on this thread who lost their Rent A Room Scheme access because of lodger daytime working.

Assuming you are correct - how the landlord is supposed to know what kind of stuff the lodger is doing on their laptop?

I'm just quoting what someone said on page 5 of this thread.  

So, someone who registered, posted 3 times on this thread, left 9 days ago and hasn't been seen since.

Right, I'd absolutely be trusting that person.

If you'd Googled this, you'd see it's a common thread and people seem to think that working from home, whilst not running a business, isn't quite what the idea was back in 2006 when the guidance was last updated and few people hybrid worked.

You need to direct this at HM Gov. I'm on your side. Let us know what they say. 

Emily_Joy

1404 said:

mybestattempt said:

1404 said:

Emily_Joy said:

subjecttocontract said:

It seems that HMRC haven't moved with the times. WFH is the new normal for a large proportion of working age people AND surprise, surprise they WFH during the daytime. I guess HMRC might eventually get around to understanding how the new world order operates ! Although I wouldnt expect to much to soon.

I am actually a little confused now. Occasionally I work from home - for instance, if I need to finish important job-related paperwork I prefer to stay at home till it is done because there are less distractions than at workplace. Do I need to tell my landlord?

If your landlord uses Rent A Room Scheme for your rent then you can only work from home in the evenings and weekends.

If your landlord doesn't use Rent A Room Scheme, and instead pays tax on your whole rent (and claims expenses against it) then you can work during the weekdays.

That seems to be the situation.

It isn't the situation at all.

A lodger working at home occasionally during daytime hours would be viewed by HMRC in the same way as a lodger working at home on evenings and/or weekends.

I would add that lodger has no need or responsibility to become involved in the landlord's tax affairs.

And a landlord has the right to remove a lodger at any time giving them only reasonable notice.  The power is not with the lodger.

Right. "I am a university lecturer. I have been asked to vacate my lodgings because the landlord spot me reading the course textbook during breakfast, deemed it to be "working from home" and got worried sick about his tax implications". Will probably go fine with newspapers.