With the arrival of this year’s A-level results, a new wave of parents will face the prospect of their teenagers flying the nest to University. Whilst some will be celebrating, for most the empty (and quieter) home left behind is somewhat disconcerting. There’s also the question of what to do with all this room. Do we need a house this size anymore? Is it however really the best time to sell?
September is second busiest time of the year for rooms for the working week specialist mondaytofriday.com as parents flock to fill their empty nest. The first £4250 you earn from renting out a spare room in your home is tax free under the Government’s Rent a Room Scheme. If you don't normally receive a tax return and your receipts are below £4250 the tax exemption is automatic so you don't need to do anything. If your earnings are above the tax-free threshold, you must inform HMRC by completing a Self Assessment tax return and claiming the allowance.
Using the tax free cash from a weekday lodger as a monthly overpayment on your mortgage could reduce a £100,000 mortgage term by over 10 years and save you over £20,000 in interest. These figures also ignore the added bonus that you will be mortgage free after 15 years. Alternatively, use the money towards home improvements or even to create an extra room by paying the money off a homeowner loan for a loft conversion or extension. For some parents, it’s simply the knowledge that there’s some extra cash to contribute towards regular bills.
Mondaytofriday.com Founder Judy Niner has some top tips for anyone thinking of renting out their spare room:
For lodgers, a spare room offers a simple solution to long distance commutes, work life balance, a miserable hotel room existence or being at the mercy of friends with a sofa bed. 52% of Mondaytofridayers save 2 or more hours on their commute, reduce their petrol bill and benefit from a stable home from home in the working week.
We have the longest commutes in the whole of Europe - over 800,000 of us commute in to London alone. The current economic climate means people have to work harder to find employment and in many cases, look further afield for work. Weekday lodging increases the options by offering a cost effective solution to a long commute or a temporary project away from home. For cash-strapped homeowners the additional tax free income can make a real difference – on average a homeowner can earn £400 a month from renting out their spare room 5 days a week. To find out more visit www.mondaytofriday.com
Judy Niner is the founder of www.mondaytofriday.com