Income Tax (Trading and Other Income) Act 2005 (c. 5)

Part 7 U.K. Income charged under this Act: rent-a-room and foster-care relief

Chapter 1 U.K. Rent-a-room relief

Alternative calculation of profits if amount exceeds limit U.K.

798 Alternative calculation of profits: income chargeable under Chapter 8 of Part 5 U.K.

(1) This section applies if the individual has any rent-a-room receipts for the tax year which are chargeable to income tax under Chapter 8 of Part 5 (income not otherwise charged).

(2) The amount charged for the tax year arising from all the agreements from which the receipts are derived is—

(a) the amount of the receipts for the tax year so arising, less

(b) the deductible amount.

(3) The deductible amount is—

subject to a maximum of I.

(4) In subsection (3)—

• L is the individual's limit for the tax year,

• I is the amount of the receipts for the tax year arising from the agreements, and

• R is all the individual's rent-a-room receipts for the tax year.

(5) In calculating the amount of any rent-a-room receipts for the purposes of this section, no deduction is allowed for expenses or any other matter.