Live in landlord definition, alternatives?

Tiners · 9 July 2017 at 10:04AM

How are you going to lose £30,000 on the sale?

Cheeky_Monkey · 9 July 2017 at 10:47AM

What part of the phrase 'live in' don't you understand?

In order for the person renting a room in your house to be a lodger rather than a tenant, you must be permanently living in the same house. Any other scenario, like the one you're suggesting, would mean that they would be a tenant. It's that simple.

IsThisUserNameTaken · 9 July 2017 at 1:03PM

Tiners wrote: »

How are you going to lose £30,000 on the sale?

It's an estimate, but if the job starts in September, it would need to be a very quick sale, I think £30000 is a conservative loss for the timescale needed. I cannot afford to both rent and pay a mortgage, so either need to have sold the house in order to pay rent/buy something else, or have a lodger so I can afford rent.

Tiners · 9 July 2017 at 1:46PM

It depends what this £30k reduction represents as a percentage of your perceived house value?

I can only repeat what I've said previously, ANY house in ANY part of the UK will sell quickly and easily if it has a sensible and realistic asking price... it's only a ''slow market'' for overpriced houses with greedy deluded vendors.

I live in North Wales, certainly not an area perceived as 'hot market' but I've seen 3 houses all sell in less than a week this month alone.. all 3 houses were just realistically priced and certainly weren't at giveaway bargain prices

00ec25 · 9 July 2017 at 1:57PM

IsThisUserNameTaken wrote: »

I was looking at the rent a room scheme and becoming a Resident landlord, to give the most flexibility, but I am so out of my depth I don't know what my options are or where to start looking.

The definition of live in landlord is confusing me, I don't know whether I could qualify;

IsThisUserNameTaken wrote: »

My daughter would of course come with me. It would mean renting something small, I can't afford anything more, I can't see us using the place as more than a base, but although not great in the short term, longer term it might be worth it.

you will not qualify for the Rent a Room scheme and if you try to claim the £7,500 tax free allowance that would be tax fraud.

there is no single definition of resident LL for tax purposes (we are not talking about the right of the occupant under housing law). Whether the property qualifies as your only/main home is primarily based on the "matter of facts" and has been subject to numerous legal cases testing specific circumstances.

the bottom line is each case is judged on its own merits. If you want a link then read this:
https://www.gov.uk/hmrc-internal-manuals/property-income-manual/pim4001

"When the taxpayer has more than one home
Whether a property is an individual’s only or main residence at any time in the basis period is entirely a question of fact. You should look critically at any claim for rent-a-room treatment for second homes and holiday homes. Normally we would expect the main residence to be the property that is the taxpayer’s home for most of the time. In other words, where friends and correspondents would expect to find the taxpayer.

...

The main residence test for rent-a-room is a purely factual one: has the residence actually been the main residence at any time in the basis period? The judgement in Frost v Feltham [1980] 55TC10 gives some indication of the matters that are relevant in considering whether a property is a main residence."

some of the factors considered are:

Most of their possessions are;
Where their family lives, if they are married or in a civil partnership;
Where they are registered with various organisations such as a bank, GP or an insurance company;
Where they are a member of clubs and societies.
If the individual has children, where they go to school;
At which residence the individual is registered to vote;
Where the individual works.

in your case you will be living and working 250 miles away for most of the time. Your kid will be with you and may (or may not) be in school where you live but she sure as heck won't be left alone at the property which you want a "rent payer" to live in.

you will not be able to claim the occupant is a lodger as you will not be a resident landlord in your main home, it will no longer be your main home. They will be a tenant and you will need to let it as an Assured Shorthold Tenancy (AST).

As you wish to return to that property on occasion you obviously cannot grant exclusive occupation of it to your tenant. therefore your AST would be of a specific room with the right to access common parts of the property which will be shared with you. That does not make you a resident LL, it makes you a LL of a shared property

read everything on GM's excellent guide to what you need to know and do to become a LL:

http://forums.moneysavingexpert.com/showthread.php?t=5180214

IsThisUserNameTaken · 9 July 2017 at 2:14PM

Cheeky_Monkey wrote: »

What part of the phrase 'live in' don't you understand?

In order for the person renting a room in your house to be a lodger rather than a tenant, you must be permanently living in the same house. Any other scenario, like the one you're suggesting, would mean that they would be a tenant. It's that simple.

I'm a teacher, likely would be working 4 days per week. If you now factor in holiday time and weekends, I'd need to be in my work place home less than 50% of the time, though certainly it wouldn't be realistic to commute 250 miles each way. My own home is a house, the work base would be the cheapest flat that would accommodate us adequately, I can't see myself choosing to spend more time than needed there. I'd have been sleeping in both places a fair proportion of the time is my guess. I don't know what proportion of the time I'd have to have spent in my own home? do I have to sleep in my own house more than 50% of the time?or spend more hours in my home than the other? Or more than 50% of the hours available in the year in my own home? As it happens, it's moot, because as a previous poster stated, it would cause issues with getting my daughter into a local school, so it's a no go for me, but that's why I was questioning it. It didn't, and still doesn't seem black and white to me.

IsThisUserNameTaken · 9 July 2017 at 2:17PM

00ec25 wrote: »

you will not qualify for the Rent a Room scheme and if you try to claim the £7,500 tax free allowance that would be tax fraud.

there is no single definition of resident LL for tax purposes (we are not talking about the right of the occupant under housing law). Whether the property qualifies as your only/main home is primarily based on the "matter of facts" and has been subject to numerous legal cases testing specific circumstances.

the bottom line is each case is judged on its own merits. If you want a link then read this:
https://www.gov.uk/hmrc-internal-manuals/property-income-manual/pim4001

"When the taxpayer has more than one home
Whether a property is an individual’s only or main residence at any time in the basis period is entirely a question of fact. You should look critically at any claim for rent-a-room treatment for second homes and holiday homes. Normally we would expect the main residence to be the property that is the taxpayer’s home for most of the time. In other words, where friends and correspondents would expect to find the taxpayer.

...

The main residence test for rent-a-room is a purely factual one: has the residence actually been the main residence at any time in the basis period? The judgement in Frost v Feltham [1980] 55TC10 gives some indication of the matters that are relevant in considering whether a property is a main residence."

some of the factors considered are:
Most of their possessions are;

Where their family lives, if they are married or in a civil partnership;

Where they are registered with various organisations such as a bank, GP or an insurance company;

Where they are a member of clubs and societies.

If the individual has children, where they go to school;

At which residence the individual is registered to vote;

Where the individual works.

in your case you will be living and working 250 miles away for most of the time. Your kid will be with you and may (or may not) be in school where you live but she sure as heck won't be left alone at the property which you want a "rent payer" to live in.

you will not be able to claim the occupant is a lodger as you will not be a resident landlord in your main home, it will no longer be your main home. They will be a tenant and you will need to let it as an Assured Shorthold Tenancy (AST).

As you wish to return to that property on occasion you obviously cannot grant exclusive occupation of it to your tenant. therefore your AST would be of a specific room with the right to access common parts of the property which will be shared with you. That does not make you a resident LL, it makes you a LL of a shared property

read everything on GM's excellent guide to what you need to know and do to become a LL:

http://forums.moneysavingexpert.com/showthread.php?t=5180214

Thank you so much for the details. I had realised that it was a no go, but it's useful to know what the rules are for future

dionysia · 9 July 2017 at 2:18PM

It is possible to have your main home as somewhere other than the place you stay most nights, but there's no fixed legal definition. The question arises in a number of different tax and benefits issues in particular. Case law has set out some general things to consider when deciding which is your main residence (see for example here. Probably you'd be caught at some point by someone like HMRC (on whether you have a right to the Rent a Room relief), one of the councils (on where you should be paying council tax and whether or not they have a duty to provide your daughter with a school place), or a court (your 'lodger' taking you to court to claim AST rights). And then they would tell you, on the facts of your particular case, where your main home is for the purposes at hand. So it's high-risk.

The other thing that makes your proposal pretty worrying is that to make the sums add up, you're relying on your tenant/lodger paying rent. If they stop paying but won't leave you're !!!!!!ed, not only because you can't afford it but because you then can't get rid of them without the question of whether you're live-in or not coming back up (see here - you can forcibly evict a lodger but not a tenant).

G_M · 9 July 2017 at 2:36PM

IsThisUserNameTaken wrote: »

Edit: haven't got my head round how to quote other people's posts in my reply, hence the responses being unclear as to whom I'm replying to sometimes.

Under each post there is a big button marked: "Quote".

click on it. Then add whatever text you wish either above, or below, the quote.

G_M · 9 July 2017 at 2:40PM

"In your head" it may still be your main home.

But in law, it would not. Your home would be where you live most of the time. Near your work

You would be leaving a 'tenant' in exclusive occupation of your property, so he'd have all the legal rights and protections of a tenant, not least with an intitial 6 months security from eviction, and 2 months notice thereafter.

you also have to declare the rent for tax. and comply with a raft of laws and regulations.

Plus many buyers will not be interested once they find a tenant in occupation, even assuming your tenant allows them in to view (he may not!).

ths idea is a non-starter.

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Live in landlord definition, alternatives?

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