Airbnbing my home while on holiday

[Steve3246]

Hi guys, first off, sorry if this has been posted a million times before, just not sure where to turn for advice. I currently only use Airbnb as a guest, but am going to Japan for three weeks in October and want to Airbnb my home to help cover some of the costs! That's the only hosting I'll be doing. My questions are:

- to those that have done this, this sort of one-off hosting, is it worth it? 

- do I have to consider tax? I don't currently do a tax returns, would I have to for this? And thus does it make it worth it?

- is there anything else I should consider i.e. capital gains tax or my home insurance?

Thanks so much in advance,

Steve

[Mike-And-Jane0 · Accepted solution]

@Steve3246 Home insurance would be an issue as will your mortgage provider/leasholder if you have one - You'll need the permission from the former two and check the lease for the 3rd..

Yes the earnings will be taxable so you would need to do a tax return.

Capital gains will be a non issue as the proportion of time rented vs owned will be tiny.

[Steve3246]

Thank you! I am freehold so would just be insurance/mortgage company. Capital gains was the one I was most worried about, would you mind elaborating on that point a little? Thank you so much.

[Mike-And-Jane0]

@Steve3246 when you sell a house  after say 10 years but you have rented it for 5 years then, in simple terms, you pay CGT on 5/10 or 50% of the increase in price minus the allowance (which is currently £6000 dropping to £3000 next year).

So if you rent for 3 weeks having owned the property for say 10 years when you come to sell it then you will pay CGT on  3/520 of the increase in price - 3000. 

Its a bit more complicated than that but in essence it will be irrelevant to you.

[Steve3246]

Thank you! Just one question: what does that 3000 in your comment above represent? Only bit that trips me up! Thank you

[Mike-And-Jane0]

@Steve3246 the £3000 is the annual capital gains limit. So in the year you sell, if your taxable capital gain is £2000 then you reduce this by 3000 and pay nothing. In the unlikely event your taxable gain is 10,000 then you would only pay CGT on £7000.

[Helen3]

You'll also need to cleaner to prepare the property, to lock away all valuables and sentimental items and have someone available locally to manage things if there are any issues with the property during the guests stay or problems with the guest @Steve3246 

[Bob297]

@Steve3246 
My daughter did the same. She is in Guatemala for five weeks and rented her home for that period.
She did not use Airbnb but found online a trustworthy young lady from Canada who wanted to stay five weeks in The Netherlands. She probably used a local website to advertise, maybe even Facebook.