Relative booking for a long-ish period

[Neil555]

Hi, I wonder if anyone could give me an answer to a couple of hopefully simple questions.

I have a relative who would like to stay in my Airbnb for a couple of months due to work. I'm happy to put it to a reduced letting as it will be a time when there will be little interest and I would probably have it closed anyway.

My two questions are:

1. Is there any restriction on letting to a relative (she has an Airbnb account and uses it anyway) at a reduced rate?

2. I don't think I can do more than 28 days in one go - is it allowed just to book a couple of 28 days which are consecutive?

I don't want to do this as a "proper rent" as it's probably too much hassle getting contracts etc drawn up.

There is no problem with my relative being honest and everything else, so that's not the problem, I'd just like to know a bit about Airbnb's rules if anyone can help.

Thank you!

[Mike-And-Jane0]

@Neil555 If you need to the nights to count toward the 105 night Furnished Holiday Let requirement then you cannot exceed 30 nights. It is unclear if 2 30 night periods count and they certainly would not if consecutive so you would need the guest to leave for a couple of nights. 

The rent also has to be at a commercial rate so £1/night also wouldn't count.

Why do it through Airbnb? If the relative came to you outside of Airbnb there is no reason to use them.

[Neil555]

Thank you for that helpful reply. It’s not to do with the number of letting dates, as it’s over that number anyway. I was letting it through Airbnb to them as they offered to pay and it seemed easier to do that rather than just say “how is £10 a night” as it saves all sorts of tax problems and other benefits. Can I ask where the commercial rate is from? Is it a government requirement or an Airbnb one? And the house is usually let for something like £35-£45 a nigh. Would £10 a night be an appropriate commercial rate or not? If it’s all too complicated then maybe I’ll just have to do it privately. Thank you for your help!

[Helen3]

In your situation @Neil555  I would look at long term rents in the area for similar places and then add on costs of utilities and council tax and use that as the rate to charge your relative for a direct booking 

[Mike-And-Jane0]

@Neil555 A few more thoughts:

If you have achieved the 105 booked nights threshold and the 210 nights availability threshold then you don't need to worry about how many nights they stay or whether it is let at a commercial rate (Government requirement for FHL status).

The commercial rate is not defined anywhere to my knowledge and is just a judgement call if you were ever investigated.

The only other thing you might run up against is if Airbnb think the rate is so low (Airbnb requirement) that you are effectively 'buying' a good review. Again there will be a number buried somewhere in Airbnb's computer that defines this but I have no idea what it would be. worst case they will just delete the review.

There are no tax problems going direct as long as you remember to add the revenue onto Airbnb's revenue when you do your tax return.

A couple of other random thoughts: You cannot charge utilities separately without providing an EPC for the property .

Do you know all the FHL tax advantages such as mortgage interest being able to be set against tax, revenue can be shared between husband/wife anyway you want, and no council tax as business rates will apply with a likely 100% call business rates relief?

[Mike-And-Jane0]

@Neil555 I have just realised your place is in Wales. You need to do your own research on the Welsh rules as they may or may not be the same as the English.

Also your cottage has zero availability. Is this intentional?

[Neil555]

I do follow the Welsh rules as they are quite different to England, and they have changed a lot this current year. 

The last guests (left first week of April) reported a leak in the Velux window in the kitchen and when I went down it was actually pretty damaged and leaking a lot. I've withdrawn it from availability until I can get this fixed - it's not so easy in rural Wales to get someone, but hopefully it can be done soon!

A great deal of my lettings tend to be within a week or few days of arriving, so I don't mind closing it all off until it is fixed and fully ready to go even though it's a nuisance.

[Neil555]

Hi, sorry for the delay in replying. The Welsh government have changed the minimum length of stay for the coming year and I expect to be likely to reach it anyway - I think it's 182. I understand the idea of buying a good review, but I wouldn't really expect a review from a relative anyway!

It would be during two months of the winter when I close it for three months, so in a sense there is no "commercial rate" at that time as it hasn't been let during those months for the last five or so years, but I fully get your point. I have an accountant to do my tax (as it's a lot more complicated than just the Airbnb) so that would be relatively straightforward but I just wanted to do it as simple as possible. The other issue with the letting is that the EPC is F, which means that it can't be rented out, so it would have to go through Airbnb, or just simply done privately. My reason for going through Airbnb rather than just an "agreement" is the extra protection that it offers to me and my relative and avoids the issue of the EPC.