AirBnB

[Lambs]

S, not necessarily based on pure occupation periods. Despite renting out during the week, his original home could well still be his main residence - even before nomination. Correspondence, bank statements, etc., etc.

Regards,

Lambs

[section 44]

"moved into" suggests detachment and something other than residing between two different properties

[Lambs]

Absolutely not. Moving into an apartment means only that it is occupied. There is nothing indicate of detachment - residence is not "mutually exclusive". It is perfectly possible to have more than one residence simultaneously. A property which has formerly been a long-term residence, and is then let in the week but re-occupied at weekends clearly remains - and unequivocally so - a residence. As I said at the outset, "quantity" is not the deciding factor. I could "move into" a girlfriend's flat armed with no more than a change of clothes, a toothbrush and a winning smile - and it would be no more my residence than an hotel suite. Where is my furniture, my stereo, my bed, my mortgage, my correspondence address, my broadband and utility bills? Where do I call home? If turfed out of a speeding car in the early hours, insensate and inebriated, whither would I mysteriously gravitate with the instinct of a homing pigeon - albeit a slightly sozzled one? And, most importantly, armed with a key and right to enjoy said property, free from trespass?

Regards,

Lambs

[bd6759]

Just to add, it is not revenue that is taxed but profits. If RARR is not available, he will still have costs that he can deduct from the revenue to arrive at the taxable amount.

[Incredulum]

I'm with Lambs.

If he had actually "moved in with" his girlfriend then he would be renting the house out on a lease. It is perfectly possible to have two residences. A "second home" which HMRC are happy for you to elect (often for a short period) as your PPR may be occupied no more than a few weekends a year.

For income where there is a lodger in your main residence then you get rent a room relief even for the nights when you are away on business, or in a hotel, or staying with some floosie.

On the other hand, he also gives exclusive use of the flat to some of his customers. HMRC are quite clear that if the property is not your residence then rent-a-room relief cannot apply - see PIM 4001. "Therefore, there can be no rent-a-room relief where the property ceased to be used as the taxpayer's accommodation before the letting began (or commenced to be used as the taxpayer's accommodation after the letting ceased), even if that is in the same year of assessment."

So can it still be his main residence if he has granted a licence for exclusive use of the property to a third party? I think not. This income therefore must fall outside rent-a-room relief.

So you have the happy situation that he benefits from rent-a-room relief for £4,250 of lodger-type income, and is entitled to offset costs against the exclusive-use-type income.

As an aside, B&B income is usually trading income, not property income.

[Lambs]

But a B&B would be only a temporary occupation, so his underlying ability to retain free use of the property as his residence, whether or not he factually exercises it a great deal, is largely untrammelled. So long as he occasionally resides there, it will remain a residence notwithstanding he allows full run of the property (in which case, how would he be providing additional services, if not present?) if only for a few days at a time. You would surely need to be looking at a more substantive letting period of unfettered use before you'd be at risk of losing residence status, and then having to fall back on lettings relief.

Regards,

Lambs