Property Income From Own Home

Air BnB Income

Any money an individual generates from an Air BnB rental on their own home may become subject to income tax.

The rent a room allowance of £7,500 (per household) can only ever be used when the property owner occupies the property at the same time as the tenant. This would mean if you let your home to holidaymakers whilst you are away on holiday, you would not be able to benefit from this allowance.

In contrast, if you received rental income from Air BnB for letting a room in your home, whilst you occupied the home, up to £7,500 may be received tax free in a given tax year per household (not individual).

It is worth noting, that each individual has a property allowance of £1,000. If a married couple received under £2,000 from Air BnB whilst they were away from their home (and they had no other sources of rental income) they will not need to report this income or pay any tax to HMRC unless the individuals are already in self-assessment. In either instance no tax is due on this income.

Driveway Rental

We often, we come across instances where an individual lets out their driveway, particularly in the summer months. Any income from this source can potentially be covered by the individual property allowance of £1,000 described above. Again there will be no need to report anything to HMRC, unless the individual is already in self-assessment. In either instance no tax will be payable or pay any tax

If income from Air BnB or a driveway rental is over £1,000 then it would be taxable and will need to be disclosed on a Tax Return. A taxpayer may still wish to use the property allowance describe above, particularly if the value of rental expenses is under £1,000.

Should you have any questions concerning the above, please call 023 8046 1237 or email Joe Wilson.