786Meaning of “rent-a-room receipts”U.K.
(1)For the purposes of this Chapter an individual has rent-a-room receipts for a tax year if—
(a)the receipts are in respect of the use of furnished accommodation in a residence in the United Kingdom or in respect of goods or services supplied in connection with that use,
(b)they accrue to the individual during the income period for those receipts (see subsections (3) and (4)),
(c)for some or all of that period the residence is the individual's only or main residence, and
(d)the receipts would otherwise be brought into account in calculating the profits of a trade or UK property business or chargeable to income tax under Chapter 8 of Part 5 (income not otherwise charged).
(2)Meals, cleaning and laundry are examples of goods or services supplied in connection with the use of furnished accommodation in a residence.
(3)If the receipts would otherwise be brought into account in calculating the profits of a trade, the income period is the basis period for the tax year (see Chapter 15 of Part 2).
(4)Otherwise the income period is the period which—
(a)begins at the beginning of the tax year or, if later, the beginning of the letting in respect of which the receipts arise, and
(b)ends at the end of the tax year or, if earlier, the end of that letting.
[F1(5)Subsections (6) and (7) apply if—
(a)the receipts would otherwise be brought into account in calculating the profits of a trade, and
(b)an election under section 25A (cash basis for small businesses) has effect in relation to the trade.
(6)Any amounts brought into account under section 96A [F2(capital receipts under, or after leaving, cash basis)] as a receipt in calculating the profits of the trade are to be treated as receipts within paragraph (a) of subsection (1) above.
[F3(6A)Subsections (6B) and (7) apply if—
(a)the receipts would otherwise be brought into account in calculating the profits of a UK property business, and
(b)the profits are calculated on the cash basis (see section 271D).
(6B)Any amounts brought into account under section 307E (capital receipts under, or after leaving, cash basis) as a receipt in calculating the profits of the property business are to be treated as receipts within paragraph (a) of subsection (1) above.]
(7)The reference in subsection (1)(b) to receipts that accrue to an individual during the income period for those receipts is to be read as a reference to receipts that are received by the individual during that period.]
Textual Amendments
F1S. 786(5)-(7) inserted (with effect in accordance with Sch. 4 paras. 56, 57 of the amending Act) by Finance Act 2013 (c. 29), Sch. 4 para. 40
F2Words in s. 786(6) substituted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 10
F3S. 786(6A)(6B) inserted (16.11.2017) (with effect in accordance with Sch. 2 para. 64 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 2 para. 33