Tax implication of switching mid-year from rent-a-room to letting out whole flat

  • Filter
  • Time
  • Show
Clear All
new posts

    Tax implication of switching mid-year from rent-a-room to letting out whole flat

    Hello. I have a mortgaged two-bed flat. This tax year (17/18), I have rented a room to a lodger. The income from that will be below the £7,500 rent-a-room tax threshold.

    However, I am possibly about to go abroad for work, and so will need to let the whole flat. If I let the whole flat in March, i.e. in this tax year, would that then invalidate the rent-a-room exemption? That is, would I then need to pay tax (less expenses) on the income I've had this year from my lodger?

    Any advice gratefully received! Thanks

    You should contact the tax office for advice if switching mid-year, to ascertain if you lose the rent-a -room allowance or not.

    Its better if you want to keep the rent a room allowance for 2017-2018 , to vacate your own residence at end of March 2018 and start the rental of your flat from April 2018 onwards ( and register yourself as a non-resident landlord with HMRC so that you can receive the rental income without tax deduction by letting agent )..


      Not what you asked but if the lodger stays on they become a tenant and wouldn't switch back to a lodger on your return.


      Latest Activity


      • Transfer to Ltd Company & SDLT
        Afternoon All,

        After much help from reading this forum I finally have question.

        I am just in the process of completing the transfer of my BTL into a ltd company.

        My solicitor has settled my personal mortgage and then taken out the new mortgage in the name of the...
        17-01-2018, 14:35 PM
      • Reply to Transfer to Ltd Company & SDLT
        No CGT as I lived in the property for a fair amount of time myself. Thanks, SDLT paid. Now in a Ltd company. Thanks for all advice.
        18-01-2018, 15:09 PM
      • Reply to Transfer to Ltd Company & SDLT
        This is not a transfer but a sale and purchase , On a personal basis there is the issue of CGT and for the Ltd co it is unfortunately a case where SDLT becomes payable . .
        18-01-2018, 09:02 AM
      • Reply to Transfer to Ltd Company & SDLT
        I assume you have good reasons for transfer to a ltd company that far outweigh other issues? have you considered establishing a partnership and THEN moving to a ltd company? the reason I ask is because I am also considering it and will be booking an appointment with a recommended advisor in the near...
        18-01-2018, 08:16 AM
      • Reply to Transfer to Ltd Company & SDLT
        As far as I know the accountant is right. This is a sale to a separate party (the company) of the whole. It is NOT a gift of the whole to the company (as in a gift to another party) in which case the solicitor advice would apply. A gift without a mortgage to a person would have no SDLT. I doubt you...
        17-01-2018, 20:38 PM
      • Reply to Transfer to Ltd Company & SDLT
        Thank you, solicitors just confirmed its market value... damm. Never mind. Although I budgeted the SDLT anyway. Thank you again.
        17-01-2018, 15:35 PM
      • Reply to Transfer to Ltd Company & SDLT
        Whichever you go with, make sure they both have adequate professional indemnity insurance in place.

        Market value. (s53 Finance Act 2003)
        17-01-2018, 15:12 PM
      • VAT on professional fees - commercial to residential planning application
        Evening all,

        We have recently submitted a planning application to convert a small commercial unit in a couple of new apartments. As I understand it the building work will be zero-rated for VAT as we are creating dwellings were none were previously.

        The planners have requested...
        16-01-2018, 20:20 PM
      • Short tax return
        I have one letting property. I have always used a short tax return which has been fine for giving totals of rent and costs inc mortgage interest. Now that the allowance for mortgage interest is reducing by 25% every year how do I show the figures? Whichever tax return I use, do I do the calculations...
        16-01-2018, 14:40 PM
      • Reply to Short tax return
        Apologies, I failed to include Theresa's link:

        Just done my draft submission: In a state of shock regarding estimated payment required 31/01/2018.
        16-01-2018, 16:26 PM