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Earn up to £7,500 per year tax-free from letting a furnished room in your home.
The Rent a Room scheme lets you earn up to £7,500 per year tax-free from letting a furnished room in your only or main home. If your rental income exceeds this threshold, you can choose to pay tax on the excess under the normal rules or use the scheme's alternative calculation. The scheme applies whether you let to a lodger, a friend, or through a platform like Airbnb.
This definition is for informational purposes only and does not constitute tax, legal, or financial advice. Rules may change and outcomes depend on your circumstances.
These GOV.UK and HMRC sources provide the official context for this glossary entry. The definition is educational and does not determine your individual tax position.