Who the scheme is for
The Rent a Room Scheme can apply when furnished accommodation is let in your only or main home. It can cover owner-occupiers and tenants who are permitted to take a lodger, as well as some guest-house activity.
It does not apply to accommodation that is not part of your main home, is unfurnished, or falls within other exclusions in HMRC guidance. Check mortgage, lease and insurance permissions separately.
Count gross receipts
The £7,500 threshold covers gross income before expenses and can include amounts received for meals, cleaning or other services. It reduces to £3,750 for each recipient where the income is shared.
Below the threshold, exemption is normally automatic. Keep a simple record of rent, included services and dates even where nothing is reported.
When income exceeds the limit
HMRC allows comparison between tax on actual profit and a simplified calculation on receipts above the threshold. The better result depends on expenses and circumstances, and elections have deadlines and continuing effects.
Use the current tax-year helpsheet or an adviser before filing. Do not treat the threshold as permission to ignore housing, safety or licensing duties.
Official sources and further reading
- The Rent a Room SchemeGOV.UK · HM Revenue & Customs