Just wondered what others would say regarding my question. As I've made a company that I want to trade from as a bookkeeper, I've made an arrangement where I rent my room to my company.
The house is residential and is the ppr of my landlord. They don't file sars as their gross rental is less than £4250 pa. There is no written rental agreement between me and my landlord just a verbal agreement therefore there is an implied contract.
My circumstances:
1. I live in a room that I rent from relatives
2. I pay £60/week and has sublet the room between monday to friday 9 to 5 for £70/week. This rate is similar to local rental rates. Therefore the room is not exclusively let and the agreement has a clause that lets me reside in the room outside the agreed rental agreement which should me let claim work from home expenses of £18 a month.
2.b I am aware about my need to declare this income of 70/w less 60/w as costs on the property income return on the 14/15 sar
3. I've documented the process by a board meeting and a rental agreement.
4. I'll have to talk to my landlord about it yet. I don't want him negatively affected
5. I'll probably won't let clients in here. However co. reg address and trading address are both registered here
6. As it is an interesting case I'll have a word with a lawyer to see if the rental agreement could hold its stance vs an enquiry
So you are renting a room that you then sub let to your business.
But the room is not used wholly and exclusively for the purpose of the business as it is also residential.
The landlord is currently benefiting from rent a room relief so is paying no tax on the money that you give them... BUT.... rent a room is residential use only so they would lose their tax relief with this arrangement.
Of course, the onus is on the landlord to know what their tennant is up to in their property and to curtail activities or evict if necessary, the emphasisi is not on yourself in the absence of a written agreement preventing the running of a business from his property.
No time at the min to read that through end to end but once you have read it ask questions and we'll have a go at feilding them.
After reading just a little of the link I feel is that you will eventually end up charging £208 per year for use of home as office but by all means lets have this discussion as it looks as though it could turn into a lively and interesting debate.
But of course the question that should be in your mind is "If this is such a good idea why are accountants not renting out roooms in their own houses to their businesses or giving such as advice to others?".
Talk later,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Thank you for your replies.
I've taken the time to think about it and Shaun's point that the room has a dual purpose and is the room I live in would make it disallowable anyway. I'll just claim use of home allowance.
The case would be different if I owned or rented a whole property and then I would use a room for work and rent that room to the company.
agreed. (I did mention it but its easy to miss in my essay answers to any question).
but, more importantly. Are you going to release Santa on Christmas eve???
Everyone's been thinking thats Mr Wozniak but I know that the truth is that it's Santa and he's being held against his will in Coventry.
You know that if you don't release him that you'll be on the naughty list forever don't you.
Merry Christmas matey.... I reccon I'm going to post tomorrow just to get the prize that you promised.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Santa, The Woz...never been seen in the same room, you may have something there! Bad luck on posting too late yesterday though! I think my Bookkeeper of the Year trophy must be on a City Link van somewhere!
Have a great festive period,
Rob
Thank you for your replies. I've taken the time to think about it and Shaun's point that the room has a dual purpose and is the room I live in would make it disallowable anyway. I'll just claim use of home allowance. The case would be different if I owned or rented a whole property and then I would use a room for work and rent that room to the company.
Afraid not Richard, rent a room scheme would still be excluded. You will need to stick to either the use of room as office allowance or rent the room but declare on your personal tax return.
