- Private Wealth
- Tax & Estate Planning
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Shorter Reads
1 minute read
Published 8 October 2018
The Financial Times reports this morning that HMRC are enquiring into the tax affairs of Airbnb. Of particular interest to HMRC may be the low profits as against high revenues, something which was criticised last year by Bruno Le Maire, the French Finance Minister.
The investigation serves as a timely reminder to those that use the service to rent their rooms or entire homes in the UK, to ensure they are declaring the income generated and paying the appropriate tax.
Rent-a-room relief is set at £7,500 per year so those earning under this amount (or half if the income is shared with another person) on Airbnb do not need to file a return. Landlords who do not live in the home they rent out do not qualify for the relief.
For those that are unable to claim the relief, or that earn over the threshold, a tax return must be filed.
Some may wish to consider whether their tax liability is lower by claiming the relief, or by being able to deduct expenses in the usual manner, something which is not available under the rent-a-room scheme.
As the popularity of Airbnb rises, HMRC may continue to take an interest in the tax revenue taken and therefore ensuring compliance with the rules will only become increasingly important for users of the service.
https://www.thetimes.co.uk/article/cohabiting-sisters-demand-inheritance-tax-exemption-mvs5v680b
The Financial Times reports this morning that HMRC are enquiring into the tax affairs of Airbnb. Of particular interest to HMRC may be the low profits as against high revenues, something which was criticised last year by Bruno Le Maire, the French Finance Minister.
The investigation serves as a timely reminder to those that use the service to rent their rooms or entire homes in the UK, to ensure they are declaring the income generated and paying the appropriate tax.
Rent-a-room relief is set at £7,500 per year so those earning under this amount (or half if the income is shared with another person) on Airbnb do not need to file a return. Landlords who do not live in the home they rent out do not qualify for the relief.
For those that are unable to claim the relief, or that earn over the threshold, a tax return must be filed.
Some may wish to consider whether their tax liability is lower by claiming the relief, or by being able to deduct expenses in the usual manner, something which is not available under the rent-a-room scheme.
As the popularity of Airbnb rises, HMRC may continue to take an interest in the tax revenue taken and therefore ensuring compliance with the rules will only become increasingly important for users of the service.
https://www.thetimes.co.uk/article/cohabiting-sisters-demand-inheritance-tax-exemption-mvs5v680b
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Senior Associate
Specialising in International trusts, tax & estate planning, UK trusts, tax & estate planning and US/UK Tax & estate planning
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