One way many people improve their bank balance is to rent out their spare room! By signing up to the Rent a Room scheme, not only would you enjoy the extra income from the rent, but also up to £7,500 a year is tax free!
The be eligible for the scheme you need to own or rent a furnished accommodation. If you are renting your property you will just need permission from your own landlord to do so.
So, do you need to complete a tax return? No, if the amount you earn just from renting the room is less than the thresholds of the Rent a Room scheme, this means that your tax exemption is automatic, and you don’t need to do anything. If your rant earnings are higher than the threshold however, then you must complete a Self-Assessment Tax Return.
To read more about it visit the HMRC website! https://www.gov.uk/government/publications/rent-a-room-for-traders-hs223-self-assessment-helpsheet/hs223-rent-a-room-scheme-2017–2