11:24 PM
Shweta Pandey
Property owners serving the demand generated by the London Olympic Games have received a somber warning from the British Tax body (HMRC) Her Majesty Revenue & Customs.
The Games come to London in 2012 and with them bring millions of foreign visitors. And, these visitors will be looking for accommodation during their visit. Many London home owners are now considering renting their homes to make some extra cash
A large number of property letting websites are encouraging homeowners to rent their homes during the Games. And, many of you are likely to be lured by the opportunity to make some additional money. But what about the tax implications of renting out your home? Our guide explains more.
HMRC monitoring rental websites to check income being declared
Olympic events are taking place across the country including London, Windsor and Weymouth. If you live in one of these areas you may be considering letting out your home. However, a leading accountant is warning that you could end up facing large penalties if you don’t pay the tax on this income.
And, if you’re planning to use a website to let your home, you could be leading HM Revenue and Customs (HMRC) to your door.
Nick Parker of RSM Tenon said: “HMRC actively monitor rental accommodation websites and adverts during major events, and we suspect they will be more vigilant than ever during the Olympics.”
Rent a Room scheme allow some untaxed income
Under the HMRC’s Rent a Room Scheme, you can receive up to £4,250 a year tax-free for letting a furnished room. That would equate to around £1,000-£2,000 per week for the Olympic period.
However, if you are considering offering visitors additional services such as laundry or providing meals, these will need to be added to the rental payments received.
And, if you have received more than £4,250, you’ll need to declare it to HMRC. If you move out of your home and let it in its entirety, you may also have to pay tax on this rental income.
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