Council permission and tax Waverley Council, Surrey Uk

[Alexia219]

Hello,

I’m having a bit of a panic! We built a cabin in our garden. It isn’t attached to the house but it is in our garden. It is self-contained - 1 living area/bedroom (same room), kitchen and bathroom. The kitchen doesn’t have any appliances plumbed in - all appliances are removable. Bathroom is a toilet and shower. 

We can argue that the structure is within permitted development in terms of size, however now that it is on Airbnb we aren’t sure whether this is allowed and one of our neighbours has told us we don’t want an enforcement officer knocking at our door if we don’t have permission to use it. We have also been told we could incur a huge tax bill (one off) by this neighbour though we aren’t sure if what he is saying is correct. 

However, under the UK rent a room scheme it seems like this sort of thing is permitted.

As we have already started renting it out we are cautious of approaching the council in case doing this is going to be too expensive with applications and tax in which case we would just stop rather than having to fork out money for that.

Does anyone in the area know anything about this and have similar rentals in their garden?

Thanks

Alexia

[Pat271]

@Alexia219 I know nothing of UK laws and regulations of each jurisdiction, but I would caution you against accepting the word of any of your neighbors on this topic. Neighbors seem to be interested in discouraging short-term rentals these days. Instead, see if you can find your city and county website that describes bills and other legislation, and do a search for “rentals”, to keep the search results broad enough. Don’t rely on the UK regulations, as typically smaller jurisdictions can override them as long as the regulation is more restrictive as a result.

[Helen3]

this is not to do with STR regulations @Pat271 

this is to do with whether the OP needs planning permission for commercial use. 

it also sounds like they need financial advice from an accountant to understand their tax position 

[Pat271]

Aren’t STR regulations and Planning closely intertwined? In our neck of the woods, the Planning department IS the entity that sets STR regulations as well as issues permits for them. No permit is issued if regulations don’t allow it. The Planning department is in charge of enforcing the regulations as well. Maybe it’s different in the UK?

[Helen3]

No @Pat271 

1. Likely the OP needs planning permission to use the premises for commercial use 

2. STR regulations are set separately by local, regional or national governments . In England new regulations are currently being considered .?

[Mike-And-Jane0]

@Pat271 that's not how it works in the UK. Local governments irresponsible for different things than the national government so it is either a local or national issue. In this case the national laws will apply to everything including planning even though planning is discharged locally.

[Pat271]

@Mike-And-Jane0  I see, interesting. So in this case, the UK’s “rent-a-room” laws cannot be overridden to be more strict by any local jurisdiction, I assume. I.e. everyone can rent rooms out of the houses in which they are residents. Correct?

[Mike-And-Jane0]

@Pat271 Its complicated...... The rent a room scheme is actually an income tax break that allows people to earn £7500/yr tax free from renting a room in a house. As income tax is a national government responsibility then local governments cannot change this.

Now there are situations with Leasehold properties (a bit like HOAs) where a persons lease on an apartment in a block of flats can stop them renting a room. Of course a new government law could override these leases the government was so inclined.

[Mike-And-Jane0 · Accepted solution]

@Alexia219 You can't use the government rent a room scheme unless the room is in your house. This is easily researched on gov.uk 

[Helen3]

If you want to use a self contained property in your garden for commercial use you are likely to need planning permission @Alexia219 

obviously you can't use the government's rent a room scheme for a self contained cabin.

1. speak to the planning department at your local council 

2. for tax affairs talk to your accountant/look on the HMRC website - don't listen to neighbours. 

[Alexia219]

Thanks @Helen3 . Yeah I think it was a bit of wishful thinking when I read the government website for the rent a room scheme - I read it as the cabin being part of our property which is our main home I.e. we don’t have a second home. 

I just wonder how everyone else in UK who has this type of set up manage it without it not being financially worth it due to all the expenses and hurdles we have to jump through!