Search News


 

News

Lloyd & Co
Chartered Accountants

103-105 Brighton Road
Coulsdon
Surrey, CR5 2NG
020 8668 0500
This email address is being protected from spambots. You need JavaScript enabled to view it.

Source: HM Revenue & Customs | | 18/03/2021

Two separate £1,000 tax allowances for property and trading income were introduced in April 2017. If you have both or either type of income highlighted below then you can claim a £1,000 allowance for each.

The £1,000 exemptions from tax apply to:

  • If you make up to £1,000 from self-employment, casual services (such as babysitting or gardening) or hiring personal equipment (such as power tools). This is known as the trading allowance.
  • If your annual gross property income is £1,000 or less, from one or more property businesses you will not have to tell HMRC or declare this income on a tax return. For example, from renting a driveway. This is known as the property allowance.

Where each respective allowance covers all the individual’s relevant income (before expenses) the income is tax-free and does not have to be declared. Taxpayers with higher amounts of income will have the choice when calculating their taxable profits, of deducting the allowance from their receipts, instead of deducting the actual allowable expenses. 

You cannot use the allowances in a tax year, if you have any trade or property income from:

  • a company you or someone connected to you owns or controls
  • a partnership where you or someone connected to you are partners
  • your employer or the employer of your spouse or civil partner

You cannot use the property allowance if you:

  • claim the tax relief for finance costs such as mortgage interest for a residential property
  • deduct expenses from income letting a room in your own home instead of using the rent-a-room scheme


Latest News

Vaccine for your business
20/04/2021 - More...
There is a poignant similarity between the effects of COVID on us personally and our businesses. Thankfully, the

A reminder that not all costs are costs…
20/04/2021 - More...
Costs are defined as something that has to be paid or spent to acquire something. Costs include the acquisition

HMRC’s new penalty regime
15/04/2021 - More...
HMRC’s new points-based penalty regime for late submission and payment will start from 1 April 2022. The changes will