Is landlord (providing home services to lodgers) taxed?

[tazhull]

i just wondered if anyone could help here on a siimple tax question, if someone takes in a person or 2 into their home to live and be cared for, been paid for the pleasure, do they need to pay tax on that money or do the tax rules re lodgers kick in and make it tax free.

[jeffrey]

Is L making any profit on this activity? If not, clearly no tax to pay.

[Poppy]

HM Revenue & Customs (http://www.hmrc.gov.uk/manuals/pimmanual/PIM4010.htm) Rent a room - part of your self-assessment tax return

For a single person, the first £4,250 of income is tax free.

[TaxationPete]

Not enough information. Is this a relative, a parent or what. ???

Regards

Peter

[tazhull]

the person is charging upwards of 300 £ aweek for 2 persons. the amount is to cover "lost " wages whilst still working part time

[King_Maker]

It appears to be taxable.

The actual tax liability would depend on the amount of allowable expenditure.

[TaxationPete]

What is he doing. You mention £150 per person per week that he is charging but where is that money going. It that to cover rent if the tenants loose there jobs. Sounds dodgy to me. Who is working part time, the LL or the Tenants. Regards Peter

[tazhull]

basicly, LL took in 2 people to own home is charging around 350 weekly to "care" for them, to do so they would need payment to cover lost wagesas ll would reduce their work hours, money is suppose to cover food and care costs, food given i could buy for less than 30 a week ie sauage roll for lunch one sauage and few chips for tea etc. to me over 18 grand a year for that seems stupid.some money has been spent to make room suitable for t but it seems all show on outside and no care beneath.

[Telometer]

Even from the first post it sounds like a trading activity to me - providing B&B/hotel-type services rather than a normal rental, so not covered under the rent a room scheme. National Insurance payable too.

So, excess of income over expenditure is taxable. (For lodgers, only the first £4,250 is tax free.)


Sounds like easy money...

[TaxationPete]

I still do not see the lost wages issue here. Are you suggesting the LL is charging for his lost wages as you has to spend time caring for them. IS he related to the two people. However the activity is taxable and depending on the status of the tenants the LL may need to be inspected and approved before he can do this. The building may require approval and HSE may get involed. Regards Peter

[tazhull]

yes the l has reduced their hours therefore less wages so charging amount to cover that lost, that lost is now been made up by the t money they are related to one t.

[tazhull]

Bumped for more info