Shared occupancy test for rent-a-room relief scrapped thanks to AAT

This summer, HM Treasury proposed a new “shared occupancy test” for those renting their spare rooms to continue to qualify for the annual £7,500 rent-a-room tax relief.

This was due to be included in the 2018-2019 Finance Bill and would have brought an end to rent-a-room relief for those who rented out a single room whilst they were absent or from renting out entire properties whilst away from home.

The Association of Accounting Technicians (AAT) campaigned against the change which they said added unnecessary complexity to the tax system, had a negligible impact on tax receipts, would draw thousands of people into the tax self-assessment system and would be a “nightmare” to enforce.

Hidden deep in the 281-page review documentation accompanying this week’s Budget was a single sentence confirming the Treasury U-turn. It simply states, “Following consultation on draft legislation, to maintain the simplicity of the system, the government will not include legislation for the ‘shared occupancy test’ in Finance Bill 2018-19.”

Phil Hall, AAT Head of Public Affairs & Public Policy, said:

“AAT is delighted that HM Treasury has seen sense on this and recognised that the best solution for landlords, tenants, policymakers and the economy was to drop these plans and allow rent-a-room relief to continue as it has for over 25 years as a simple to administer, easy to understand tax relief that’s available to all.”


Kindly shared by Association of Accounting Technicians (AAT)