I make £4,200 a year renting out a room in my home to help pay for bills – how you can too
WHEN Eddie Tozeland’s wife died two years ago he found himself missing company during the evenings - so he decided to rent out a room in his home to a lodger part-time.
Eddie’s lodger, Denny, 62, is from Birmingham - but is currently working on a power station in Kent, so stays with Eddie, 64, in his three-bedroom home in Rochester, Kent from Monday to Friday.
Eddie, a retired serviceman from the Royal Navy, paid off his mortgage after his wife Tracy passed away.
The £350 a month he gets from Denny helps out with bills and gives Eddie a bit of extra cash to spend on his hobby of preserving old military vehicles.
He told The Sun: “I have noticed bills go up recently, particularly gas as I have solar panels so I was very lucky my electricity hasn’t been too affected.
"It’s probably risen by around £50-£60 a month since last September.“
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"Denny’s rent obviously does help a bit with that, but mostly it’s extra income which has helped me enjoy my hobby.
"I bought a trailer last year that I’ve been renovating so I’ve been able to buy some extra bits for that.”
While Denny’s employer pays his £350 monthly rent as part of a relocation fee for working on-site, lodging with someone like Eddie can also provide an affordable solution for people looking for cheaper rent.
“I believe full-time lodgers around here can pay as much as £600 a month, which sounds very expensive,” Eddie said.
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Denny has full access to the house and all shared living areas, as well as having his own room - and the two men spend their evenings together watching telly and chatting when Denny gets home from work.
“It’s been brilliant,” Eddie said.
“We’re around the same age and we have similar interests so we get on really well.
"I have had to start watching Emmerdale and Coronation Street though, which I rib him a bit for.”
Eddie found Denny on SpareRoom.com and said he came across his profile as he wanted somebody to take the room on a part-time basis.
“I saw he was looking for part-time lodgings for four nights during the week, which works really well for me as I wanted some company during the week but like to have my weekends clear,” Eddie said.
“I got in touch and he came round the following day to look at the room and pretty much moved in straight away.
While the arrangement does have an obvious financial benefit, Eddie says his main motivation was to help with loneliness after his wife passed away and after being diagnosed with PTSD as a result of his time in the Navy.
“I’m one of the lucky ones that can just about afford to keep my head above water without worrying too much,” Eddie said.
“But having someone around to talk to in the evenings has been the biggest benefit for me.
“Otherwise I’d probably just be going mad and shouting at the telly half the night."
Eddie said having a lodger is likely to be long-term for him - and he thinks he will look for someone to replace Denny on a part-time basis when his work contract ends.
“I put my name down to house a Ukrainian family but I’ve not heard anything back yet,” Denny says.
“If Denny were to move out I’d definitely look to get someone again, even if that doesn’t work out.”
How to rent out your spare room too
You can rent out your spare room if you own your house - but you need to let your mortgage lender know.
This is because renting out your spare room could go against your mortgage terms - make sure to check before looking for a lodger.
If you rent your house, make sure you ask for your landlord's permission.
As it's their property, they might not agree to you subletting your room out - if you get a lodger in without letting them know you're in breach of your tenancy agreement and you could be asked to leave.
If you've bought your home through the government's Help to Buy or Shared Ownership scheme, you must ask permission from your mortgage lender or housing association first.
How much you can earn tax-free
You can use the government’s Rent a Room scheme to get a lodger in and make some extra cash.
The scheme allows you to earn up to £7,500 per year - which is roughly £625 a month - tax-free letting out your room.
However, you have to furnish it yourself, so make sure you factor this cost into your calculations.
If you’re sharing the income with your partner or someone else, the threshold is halved from £7,500 to £3,750 per person.
If your earnings are below £7,500, there’s no need to let HMRC know you’re renting your spare bedroom out.
If you exceed the threshold for the Rent a Room scheme, you’ll need to let HMRC know by filling in a Self Assessment tax return.
Be aware that expenses like furnishing, repairing damage and insurance are not taken into account - so you can’t claim money back on this.
Your council tax bill could also be affected by having an extra lodger on board if you’re single.
This is because you can get a single person discount on your bill worth 25% - which you’ll lose if another person is living there.
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Keep in mind that your tenants have certain rights.
For example, you need to give your tenant proper notice of eviction - usually around a month - and by law your tenant must have access to a bathroom, kitchen and bedroom.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]