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TaxRobin
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Category: Tax
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Experience:  International tax
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My business is taking in foreign students i provide breakfast

Resolved Question:

My business is taking in foreign students i provide breakfast and evening meal
I have all receipts but I need to know what proportion of this i can claim on my tax return
Other question concerns water, gas and electric what percentage can i claim please
thanks
Submitted: 2 years ago.
Category: Tax
Expert:  TaxRobin replied 2 years ago.
and thank you me to assist you.
The Rent a Room Scheme lets you earn up to a threshold of £4,250 per year tax-free from letting out furnished accommodation in your home. You must complete a tax return if you earn more than the threshold.
You can then opt into the scheme and claim your tax-free allowance. You do this on your tax return.
If your lettings amount to a trade, Rent-a-Room relief may still be claimed, but you should exclude any assessable profits from your rental business and return them as trading profits.
To calculate the food cost you would use total in-home prepared meals and divide by the number of occupants.
The following can be claimed as expenses against the gross amount received from students, thus reducing the profit figure that you need to declare:
• Actual cost of food supplied to the students
• A fair proportion of the costs of other shared services and supplies e.g. Window cleaning, TV rent,
telephone rent, redecoration, general household repairs, gas, oil, electricity, fire and theft insurance.
• (A ‘fair proportion’ will depend on the size of the house, the number of residents, including the host
family and the length of time the students stay. It is important to note that no claim can be made for
the host’s own labour, including cooking, cleaning and decorating).
• EITHER: (1) The net cost of replacing a particular item of furniture or furnishings. This should be the cost of replacing the equipment less any proceeds received from the sale of the old item less any part
of the replacement cost that represents an improvement or addition to the original item.
Customer: replied 2 years ago.

Thanks above

As I have more than 7K gross receipts (during 8 months) it looks like i shall not use the rent a room scheme

I want to claim of beds etc

I would like to clarify ' A fair proportion' in terms of the heating etc is there any further guidance on this? can i divide by number of students and me? (there is just my self living here)

I work from my home office also in a different line of work

thanks

Expert:  TaxRobin replied 2 years ago.
Yes you could use that a fair share if the students were there all year. If not thne just fo rthe time actaullty with you would be used.
Customer: replied 2 years ago.

would this be called a furnished residential letting? In this case to claim claim 10% of the net rent as a ‘wear and tear allowance’ and equipment you provide with a furnished residential letting.

thanks

Ginnah

Expert:  TaxRobin replied 2 years ago.
If trading and offering services (meals and cleaning) yes.
Customer: replied 2 years ago.

OK thanks help happy with your service

Expert:  TaxRobin replied 2 years ago.
You are most welcome.
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