Income from rental must be declared to HMRC

Income you receive from letting a property must be declared to HMRC, and you can deduct any qualifying associated expenses which you incur. At CHW Bolton Accountants, we can calculate these figures for you.

There is a £7,500 annual allowance to cover income from letting a furnished room in your home to a lodger, but other rental income must be declared. This applies even if you didn’t set out to make a profit from your property, such as in the following situations:

Pub landlords who live above their pub may let out their former home. Even if the rent income only covers the mortgage payments on their own property, the whole amount of income and expenses must be declared on the owner’s tax return.

Parents may buy a property for their children to live in while at university. Where the property is also let to other students, that income must be declared on the parents’ tax returns. As the property is not the home of the parents the rental income, the £7,500 rent-a-room relief exemption doesn’t apply.

An individual in a residential care home may be letting their former home. Even where the rental receipts are used to pay for the care home fees, the rent must be declared on the recipient’s tax return and tax paid on the profits.

If you haven’t declared rental income correctly you can make a full disclosure to HMRC, and pay the tax due by amending your last tax return, or by using the HMRC’s Let Property Campaign service.

Your Bolton Accountants can advise you on this or any other questions you may have surrounding the topic. For more information contact us on 012041 534 031 or fill out our enquiry form.


This article is for general guidance only. It provides an outline, and may not include points which are important to your situation. You should not depend on this blog without taking advice based on the full facts of your case. The information given was correct at the time of publication.

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