Rent a Room plus Investment Property -Tax

[liteweight]

My friend owns an apartment which is rented. When her husband died last year she chose to rent one of the rooms in her house at a nominal rent. I think she just wanted the company. Her problem is that her husband always submitted the tax returns through ROS and now it's down to her!

When a person is under the rent a room scheme and owns a rental property does it make a difference? Should she just fill in the RaR section and then proceed as normal for the rental property, or should they all be put under rental income? In the first instance, she wouldn't pay tax on lodger's rent but on the latter she would. I've never come across it before.

 

[jfitzer]

Rent-a-room income in completed in the exempt income section (form 11) section c, taxable rent is completed in section d.

 

[liteweight]

That's great thanks. I'll pass it on! She just thought that as she had a rental property that RaRs wouldn't apply to her.