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Posted Tue, 16 Jan 2024 19:34:54 GMT by Su Chat
I'm a live in landlord with 2 housemates (2 separate agreements). I want to calculate my tax liability as receipts less expenses method going forward (and not claim the £7500 rent a room allowance). How should expenses be calculated - e.g. council tax, broadband, any repair costs such roof repair - can I claim 2/3rd of them as expenses, as there are 3 people in flat including me?
Posted Fri, 19 Jan 2024 11:40:06 GMT by HMRC Admin 25 Response
Hi Su Chat,
You would only claim the expenses relating to your share of the property.
Thank you. 
Posted Fri, 19 Jan 2024 11:48:54 GMT by Su Chat
Hi, that's really strange advice. So my personal expenses will be considered "expenses" for renting, where as share of expenses spent on "lodgers" are not expenses? Surely, it's the other way around? My personal expenses are not expenses, whereas share of expenses of lodgerd that I spent, are deductible? Please confirm.
Posted Mon, 22 Jan 2024 13:53:57 GMT by HMRC Admin 8 Response
Hi,
You have two options available.
If you meet the conditions and claim the rent a room relief - method A then you are allowed to receive income up to £7500 in a tax year which would be tax free.You cannot however deduct any  expenses if you use this method.
You can use the method B rather then rent a room relief which is rents received minus expenses wholly incurred for the property business.
However if this income after expenses is over £1000 then it would be chargeable to tax.
You have mentioned 'personal' expenses. I assume you mean expenses you solely incurred in relation to the property business.
HS223 Rent a Room Scheme (2023)
Thankyou.
Posted Sat, 17 Feb 2024 22:36:17 GMT by Su Chat
Hi, please answer the question asked. I have clearly said I don't want to use and not claim the £7500 rent a room allowance, and instead want to use method B. I don't understand why you are still informing me about method A. Please read the question again. I have 2 flatmates who pay rent to me (live in landlord) and I pay all the bills for the flat. E.g. the bills are £100, should £33.3 (1/3rd) be considered as my private expense, and therefore not deductable as expenses for tax purposes, and remaining £66.6 should be considered renting related expense and deductable expense for tax purposes? Im am enquiring regarding the ratio in which I can separate the expenses+please kindly don't get confused and refer me to something that I haven't asked about).
Posted Tue, 20 Feb 2024 11:43:21 GMT by HMRC Admin 8 Response
Hi,
We apologise for any confusion caused. Please proceed using Method B and quote only the share of expenditure your tenants suffer againsst rent collected as you stated. 
Thank you.
Posted Wed, 20 Nov 2024 18:54:50 GMT by biggleswade2019
Hi, I'd like to follow up on the original question as I'm not sure if it has been fully answered, and I'm in a similar situation. Please assume for this scenario that the rent-a-room scheme is not being used. I have lodgers living with myself and my partner, and would like to know if any of our household bills and costs qualify as deductible expenses, either in whole or a proportion thereof, given that they are not 'wholly and exclusively' related to the rental of the rooms? The specific costs to which I am referring are: - Mortgage interest (residential, not buy-to-let mortgage) - no additional cost incurred as a result of having lodgers - Utility bills - arguably an increase in costs due to increased use of electricity and gas units directly related to lodgers - Cleaning costs - decided to pay for regular cleaning as a direct result of having lodgers - Council tax - no additional cost incurred as a result of having lodgers - Home insurance - premium has increased as a result of having lodgers
Posted Mon, 25 Nov 2024 14:01:47 GMT by anj
I too would like an answer to the same question as the question hasn't been answered. The gov.uk website has a lot of very useful information but does not specify what / how to calculate expenses for renting a room if option A is chosen (or in fact, a default!) Can the following be included: - utilities - council tax If so, how is the proportion calculated? Is it a percentage according to the number of bedroom, the number of people or the floor area?
Posted Tue, 26 Nov 2024 14:08:01 GMT by HMRC Admin 17 Response

Hi ,
 
Thanks for your question.

As per PIM4030 attached for your convenience, outlines what Method A & B are, as well as showing examples to determine which option would be beneficial for yourself.

If claiming rent a room relief, expenses cannot be claimed against rental receipts as shown in PIM4001 also attached:

PIM4001 - Rent-a-room: overview    and

PIM4030 - Rent-a-room: receipts above exemption limit   .

Thank you .

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