Calculating UK Tax expenses

Julie4
Level 6
Brighton, United Kingdom

Calculating UK Tax expenses

I'd really appreciate some advice on how to calculate expenses for letting out my room through Airbnb for  UK tax purposes. I've found the guidelines very woolly. I expect that my earning will go over the allowance for the 2015 tax year, so need to calculate what I can allow for expenses ie laundry, cleaning, bedding, bills, repairs etc this is what isn't clear to me and do I need recepits (as I haven't kept them). I'm using the Rent a Room Scheme as guidelines. Thanks, Julie

2 Replies 2

 

Don't know if you got anywhere with this - but I would imagine it is highly unlikely that you would derive any benefit from keeping a track of your expenses.

 

The rent-a-room scheme is designed to be a flat simple scheme that does not allow expenses. I.e. you get the first £4250 tax tree and pay tax on the rest irrespective of how much you expend.

 

This is going up to £7500 next year.

 

If you thought that the amount you were spending on expenses (Mortgage Interest, Electrictity, Laundary etc) was likely to be more than this allowance then you would need to calculate your expenses and file a return. (Either way you may need to file a return but if you are just putting the amount of money that has come in on that form it will be very simple to work out.)

 

Essentially the key point is - whether to keep reciepts or not is not based on whether or not you take in more than the Rent-a-room allowence but whether you think you have more deductable expenses than that allowence.

Hello James,

 

Thank you for those details.

 

In order to complete that topic, I would like to clarify a point about allowable expense. In fact I am tenant in a 2 rooms flat and my flatmate moved few month ago taking in acount that I am the only person appearing on the tenancy contract. I decided to rent the other room on Airbnb to help me pay the rent. But except the tiny side expenses (Electricity, laundry and so on) I pay a £2200 rent per month and Airbnb in the second room only allow me to get £1500 per month. 

 

Is my rent deductible from the allowable expenses ?

 

 

Thanks a lot,

Ludo.