# Tax Implications for short term letting (Solheim Cup)?



## Stephen75 (8 Apr 2011)

Hi all,

I need this cleared up, there has been many opinions... If I rent a property short term (10 nights) how is this taxed? Is it added to my gross income?

Steve


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## Ravima (8 Apr 2011)

there are not many options. Where do you get that information? 

It is added to your gross income and tax is payable on the profit at your highest level.


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## mandelbrot (8 Apr 2011)

Stephen75 said:


> Hi all,
> 
> I need this cleared up, there has been many opinions... If I rent a property short term (10 nights) how is this taxed? Is it added to my gross income?
> 
> Steve




It's a fairly cut and dry area, if more than 10k gross rent is received in any year, there's no question of rent a room relief, so any profit on it has to be taxed as Rental Income.

What kind of opinions are you hearing?!


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## Stephen75 (9 Apr 2011)

mandelbrot said:


> It's a fairly cut and dry area, if more than 10k gross rent is received in any year, there's no question of rent a room relief, so any profit on it has to be taxed as Rental Income.
> 
> What kind of opinions are you hearing?!


 
So if I earn more than 10K in a year from renting a house or apartment during the Solheim Cup I qualify for "rent a room relief"? Can you explain how this works, %'s etc.

Opinions like: 
Add it to your gross income and it's taxed as income tax,
Stamp duty throw back benefits,
Is me moving out and staying somewhere else, eating somewhere else(because I'm not in my kitchen), etc a deductable expense?


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## peteb (9 Apr 2011)

no you dont qualify for rent a room anything for renting your property out for the Solheim cup.


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## ajapale (9 Apr 2011)

Moved from Taxation to Property investment

Please post in the correct forum/subforum.


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## mandelbrot (9 Apr 2011)

Stephen75 said:


> Opinions like:
> Add it to your gross income and it's taxed as income tax,
> Stamp duty throw back benefits,
> Is me moving out and staying somewhere else, eating somewhere else(because I'm not in my kitchen), etc a deductable expense?



As far as I can see there's only one opinion there, regarding the taxation of the money received, and that is that the money is taxable as income.

What does stamp duty throw back benefits even mean?! - I can certainly think of a stamp duty CLAWBACK LIABILITY - if a house that was bought with a first-time buyer stamp duty exemption is rented out within 2 years, then the owner may be liable to hand over the stamp duty that they didn't have to pay when they bought the house. (Won't apply in your case anyway as you said you bought in Jan '09).

As for you moving out and eating somewhere else being deductible, you are joking right?!

I'm not sure why you seem to think that you should be entitled to some kind of incentive from the exchequer to encourage you to earn yourself a heap of money (which is income, you must agree) for choosing to rent out your house. Fair play to you for getting a good deal for the inconvenience of moving out for a couple of weeks, but you'll have to pay tax on practically all of it, as there aren't really any overheads involved.


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## mandelbrot (9 Apr 2011)

peteb said:


> no you dont qualify for rent a room anything for renting your property out for the Solheim cup.



Totally correct, and I'm going to contradict my earlier post to say that Rent a Room relief cannot apply to these lettings, regardless of the amount received, for (at least) a couple of reasons - the following are quotes from Revenue's Income Tax, CGT and Corporation Tax manual ([broken link removed]
_
4.2 Self-contained unit
*It is not possible to let an entire residence* because the room or rooms that are let must form part of the residence and the residence must be occupied by the individual receiving the rent as his/her sole or main residence. The room or rooms can comprise a self-contained unit within the residence such as a basement flat or a converted garage attached to the residence. However, a self-contained unit that is adjacent to the residence but not actually attached to it cannot qualify for the relief.

4.3 Business use
*The room or rooms must be used for the purposes of residential accommodation, i.e. the occupants are effectively using the room on a long-term basis, either on its own or in conjunction with other parts of the residence, as a home.* The relief does not apply to rooms that are used for business purposes. Also,* income from the provision of accommodation to occasional visitors for short periods would not qualify for relief as the visitors use the accommodation as guest accommodation rather than for residential purposes.* Income from guest accommodation such as a bed and breakfast or a guesthouse operation is generally treated as trading income (Case 1) and not rental income (Case V). This type of income, even where it is under the relevant limit, does not qualify for rent-a-room relief.

_And just in case anyone who has let their house out as Solheim Cup accommodation is reading this, might in light of the above want to check whether it is to be taxed as Trade Income (Case 1), rather than Case V (Rental income). Maybe check with the Tax Office before filing your return...


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