HOMEOWNERS who take on a lodger can earn a tax-free income of up to £7,500, according to SpareRoom, as the flatshare site pushes for more people to become live-in landlords.
Based on the average monthly room rent in York at £516 per month, the annual ‘pay rise’ needed to take home the same amount of income provided by letting out a spare room to a lodger is between £8,675 - 20 per cent tax - and £11,567 - 40 per cent tax.
SpareRoom said this equates to receiving a £10,500 gross pay rise at work for basic rate taxpayers - going up to a £14,000 pay rise for earners on 40 per cent tax.
The ‘pay rise’ is a benefit of the Rent a Room scheme, established by the Government in 2016 following campaigning from SpareRoom, to increase the amount of tax-free income homeowners can receive from letting their rooms.
According to research conducted for the guide among 2,000 people that had a lodger found 51 per cent appreciated the security and peace of mind knowing there was someone else in the house.
What’s more, 46 per cent welcomed the additional company, nearly a quarter - 23 per cent - liked meeting new people and one in five appreciated having someone look after their pets while away.
In a further survey on 1,237 people who have either had lodger previously or downloaded a guide on how to, 84 per cent of those who don’t currently have a lodger said they plan to in the near future.
Being a ‘live-in-landlord’ is an additional source of income but the benefits of sharing a home with a lodger go far beyond the financial.
SpareRoom has since released a guide detailing the many advantages - more information is available on www.spareroom.co.uk
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