Rent a room scheme

Hi, I am looking to rent a room to my father who only owns 1 property with my mum which is their main residence with 3 other siblings. Due to my mother’s illness, her sense of smell has become very sensitive and become unbearable to sleep due to my father’s strong odor of working in a restaurant and smoking. So we have come up with an idea where my dad can rent a room from my own house that is furnished. Point 1) my mum and dad own a house together which is their residence Point 2) I also own my own house which is in my name only and have a spare bedroom furnished. Point 3) I rent the room to my dad at £550 which is a total of £6,600 a year. Well under the rent a room allowance. There is no spare rooms at their own house due to a small terraced house with 3 siblings. Question: Do I need to complete tax return? My understanding according to the gov.uk rent a room scheme section, is that I DO NOT need to complete a tax return as I am under the £7,500 allowance, it is the only home I own. Source Gov.UK “ The tax exemption is automatic if you earn less than £7,500. This means you do not need to do anything. If you earn more than this you must complete a tax return.”

Hi ,
 

As the actual income is over £2500 you still need to complete a tax retrun to show that you are claiming rent a room relief for the income to be tax emempt. You cannot claim any other rental expenses if using this scheme . Thank you .

I’m sorry but can you please explain how how does the actual income is over by £2,500 ?
The tax free allowance for rent a room scheme is £7,500.
My dad would pay £550 A MONTH which means:
£550 x 12 months = £6,600 which is under the tax free allowance of the rent a room scheme.
Please can you explain how I come over the £2,500 allowance?
Thank you so much

Hi Creativedesigns
My apologies if you have been misled by our previous answer. 
The Rent a Room Scheme lets you earn up to a threshold of £7,500 per year tax-free from letting out furnished accommodation in your home. 
This is halved if you share the income with your partner or someone else. You can let out as much of your home as you want. The tax exemption is automatic if you earn less than £7,500. 
Guidance is available at: Rent a room in your home: The Rent a Room Scheme & one of our very short videos at Rent a Room relief which advises the boxes requiring completion. UK Property notes will also assist at Self-Assessment: UK property (SA105).
Thank you
 

Hi, Thank you for confirming this. Last question please. It will be my father that will be renting a furnished bedroom at my house during the days he works due to my mothers illness, we’re having to make arrangements where he cannot stay at his own house with my mum and my siblings because he works in a restaurant and he smokes a lot whilst he’s at work so when he goes home, he’s having to sleep on the living room floor because my mother has become very sensitive to odour and is unable to sleep. So he will be renting my room out between 3-4 days a week depending on what days his employer needs him and 3-4 days a week he will be living at his own home when he is off at work to look after my mum. So as long as I create a tenancy agreement for a rent a room for my dad to rent out, and earn under £7,500 this is ok? And no need to complete self assessment until I earn more than this or have other source of income right? Thank you

Hi,
You are correct in your understanding, As long as a valid tenancy agreement is created outlining the monthly rent figure to yourself for renting out the room within your property, there is no requirement for a Self Assessment tax return to be completed unless the income exceeds the £7,500 income figure.
Thank you.