Renting out an attached annexe
Posted: Thu May 24, 2018 8:57 am
Hi everyone,
Total newbie to this site and the whole holiday letting world. Looking for some advice from you seasoned experts please.
My husband and I have recently purchased a bungalow with an attached one-bed annexe (with bathroom/living/kitchen/patio area). There is an interconnecting door between the two, as well as separate front and rear entrances for the annexe. It needs some work (husband’s a builder) and we have a desire to eventually rent it out as a "luxury" short-term holiday rental to help contribute towards the mortgage.
We’re not looking for this to become a huge business; rather we plan to let it for around 60 days per year at approx. £125 per night so that we come under the Rent-a-Room threshold of £7500pa. The rest of the time it will be used by ourselves and family. The plan is possibly to rent solely through Airbnb.
It isn’t currently registered for separate council tax.
Although it will be a low-key earner and only temporarily used for letting, we would like to do everything properly, such as ensuring it meets safety/fire regs, etc. My questions are:
1) Do we have to register this as a business if we will not be exceeding the Rent-a-Room threshold, and if it is part of our main home? (i.e. equivalent of having a lodger staying with us.) I’m assuming business rates are not relevant here?
2) How do we go about arranging insurance? As this is not a separate holiday let as such (but rather is part of our main home), I’m assuming we don’t need specialist insurance. However, should we also be informing our home insurance company?
3) Do we definitely need to inform our residential mortgage company? We will not be renting out the rest of our home and will always be on the property, so part of me thinks they merely count as (albeit paying) guests. (I imagine the answer is YES to this question…)
4) Any other companies we should be contacting/registering with, etc?
5) Should we be applying to the council for planning permission for change of use? I'm thinking not as it will usually be used as part of the main house, but please correct me if I'm wrong.
We live in Kent, U.K.
Thanks in advance for your advice.
Total newbie to this site and the whole holiday letting world. Looking for some advice from you seasoned experts please.
My husband and I have recently purchased a bungalow with an attached one-bed annexe (with bathroom/living/kitchen/patio area). There is an interconnecting door between the two, as well as separate front and rear entrances for the annexe. It needs some work (husband’s a builder) and we have a desire to eventually rent it out as a "luxury" short-term holiday rental to help contribute towards the mortgage.
We’re not looking for this to become a huge business; rather we plan to let it for around 60 days per year at approx. £125 per night so that we come under the Rent-a-Room threshold of £7500pa. The rest of the time it will be used by ourselves and family. The plan is possibly to rent solely through Airbnb.
It isn’t currently registered for separate council tax.
Although it will be a low-key earner and only temporarily used for letting, we would like to do everything properly, such as ensuring it meets safety/fire regs, etc. My questions are:
1) Do we have to register this as a business if we will not be exceeding the Rent-a-Room threshold, and if it is part of our main home? (i.e. equivalent of having a lodger staying with us.) I’m assuming business rates are not relevant here?
2) How do we go about arranging insurance? As this is not a separate holiday let as such (but rather is part of our main home), I’m assuming we don’t need specialist insurance. However, should we also be informing our home insurance company?
3) Do we definitely need to inform our residential mortgage company? We will not be renting out the rest of our home and will always be on the property, so part of me thinks they merely count as (albeit paying) guests. (I imagine the answer is YES to this question…)
4) Any other companies we should be contacting/registering with, etc?
5) Should we be applying to the council for planning permission for change of use? I'm thinking not as it will usually be used as part of the main house, but please correct me if I'm wrong.
We live in Kent, U.K.
Thanks in advance for your advice.