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Tax query on occasional rental of our ONLY property

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charlyfane
charlyfane Posts: 2 Newbie
in House buying, renting & selling
I have a question about income tax. We rent out our house for up to 3 weeks per year max, because we live adjacent to an estate which hosts 3 summer festivals, and it profits us to do so. During this time we go stay with relatives. Is this income, from the occasional rental of our ONLY property, taxable? If so, what construes ‘allowable expenses’? We put much of what we earn from this practice back into the house in order to keep it nice for our paying guests. Is all of this (redecorating, replacing worn-out items) claimable? I know you are not allowed to claim for improvements, but for upkeep?

There’s a lot of HMRC information on rental of second properties, but when it’s the principal residence….?

Thanks.

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  • BoGoF
    BoGoF Posts: 7,099 Forumite
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    Yeah sure - you keep it nicely decorated for your guests and not for your benefit?

    Of course it's taxable.
  • G_M
    G_M Posts: 51,977 Forumite
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    you receive rental income- it's taxable. The number of properties you own is irrelevant.


    The redecoration is clearly not just benefitting your tenants/licenced occupiers (that's another question!). For 49 weks of the year you are benefiting from it looking nice.
  • HampshireH
    HampshireH Posts: 4,480 Forumite
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    :rotfl: I'm sure this is legitimate but the "replacing worn out items" made me laugh....also no one decorates every year for someone elses 3 week stay.

    Taxman would see right through that.

    Hope the payment you receive is worth the declaration and whatever tax that looks like. If not maybe it isn't worth it?
  • 00ec25
    00ec25 Posts: 9,123 Forumite
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    charlyfane wrote: »
    I have a question about income tax. We rent out our house for up to 3 weeks per year max, because we live adjacent to an estate which hosts 3 summer festivals, and it profits us to do so. During this time we go stay with relatives. Is this income, from the occasional rental of our ONLY property, taxable? If so, what construes ‘allowable expenses’? We put much of what we earn from this practice back into the house in order to keep it nice for our paying guests. Is all of this (redecorating, replacing worn-out items) claimable? I know you are not allowed to claim for improvements, but for upkeep?

    There’s a lot of HMRC information on rental of second properties, but when it’s the principal residence….?

    Thanks.
    it appears you can read. So why have you not put 2 and 2 together and worked out that rental income is taxable because it is income ?

    as for how you work out your profit, do some more reading...
    https://www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

    pay particular attention to this given your inability to grasp what an allowable cost is:
    https://www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income
  • comedyseeker123
    comedyseeker123 Posts: 182 Forumite
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    Would this fall at the £7k limit?
  • 00ec25
    00ec25 Posts: 9,123 Forumite
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    comedyseeker123 wrote: »
    Would this fall at the £7k limit?
    there is no £7k limit.

    the rent a room scheme (£7.5k) applies to landlords who live in the property whilst the other person is present. OP has clearly stated:
    charlyfane wrote: »
    During this time we go stay with relatives.
  • silvercar
    silvercar Posts: 46,968 Ambassador
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    You each have a trading allowance of £1000.

    https://www.litrg.org.uk/tax-guides/self-employment/what-trading-allowance
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • theartfullodger
    theartfullodger Posts: 14,605 Forumite
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    The clue is in the name of the tax: INCOME tax.
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