½Û×ÓÊÓƵ

The tax treatment below applies where an individual qualifies for rent-a-room relief in a particular tax year but the total rent-a-room amount exceeds their limit (see B6.603)¹.

The default position is that the rent-a-room income is taxed under the normal rules for either trading income, property business income or miscellaneous income, as appropriate.

However, if the individual prefers, they may make an election for partial relief which applies an alternative method of calculating the rent-a-room income². Under the alternative method, the taxable income is restricted to the excess of the receipts over the individual's limit. No deduction is allowed for the actual expenses.

The election for partial relief must specify the tax year to which it relates and it will then have effect for the specified year and for subsequent tax years (unless it is withdrawn by notice given by the individual or deemed to be withdrawn)³.

If an existing election would have effect for a tax year in which the individual's total rent-a-room income did not exceed their limit, the individual