The short version: The Property Income Allowance is a £1,000 tax free allowance for rental income. If your rental income is under this amount, you don’t need to tell HMRC or pay tax on it.
Who can use it?
Anyone with small amounts of rental income. Airbnb hosts with occasional lettings, people renting out driveways or storage space. If your total property income is under £1,000, you’re covered.
Can you use it with other reliefs?
No. It’s either the Property Income Allowance or claiming actual expenses, not both. And you can’t use it alongside Rent a Room relief for the same income.
What if you earn more than £1,000?
You can still use the allowance. Deduct £1,000 from your rental income instead of calculating actual expenses. But if your expenses are more than £1,000, you’re better off claiming those instead.
Joint ownership?
If you own property jointly, you each get a £1,000 allowance against your share of the income.
Got a bit of rental income and not sure whether to declare it? Ask us and we’ll tell you where you stand.
