62 Saturday May 28 2022 | the timesMoney
IN THE
SUNDAY TIMES
TOMORROWplus
The 11-year-old hit by
Russian sanctionsspecial report
Woodford affair
three years on
My latest
money-saving
ruse: taking
in a lodger
Home Economics
Jessie Hewitson
I
grew up in a big house with a
succession of lodgers. Over the
years about 20 people passed
through our doors to live with
my mum, my sister and me.
Always recommended by friends of
friends, they were largely sensible
young people who kept to themselves,
had a shelf in the fridge and never
brought anyone home without
asking first. The worst it ever
seemed to get was when
one lodger ran the
washing machine
to clean just one
T-shirt or the
occasional time
the odd bottle of
wine vanished
from the
basement. Apart
from that, though,
thumbs up.
My mum, who
has very specific ways
of doing things, was
more worried about the
washing than the wine. (God
help anyone who folds their T-shirt in
half on the washing line rather than
pegging it so it is upside down — that
would be a hanging offence.)
These strangers sometimes became
friends. My mum and I were invitedto the wedding of one of our
lodgers — an opera singer —
while another, a Brazilian
architect, has become a close
family friend. Karine has
patiently helped me to design
my new home and we visit her
in her in Dorset every summer.
The parents of a third lodger
took my mum on holiday
with them in east
Germany,
though she
regretted
saying
yes
within
moments of
the family
collecting her from
the airport and
hitting 100mph on
the autobahn.
For me and my
sister it was normal to
share our home this way,
even if it was difficult
timing your run to the shower. It
was also a practical solution for my
mum, who had to be careful with
money, and a good option for anyone
trying to make ends meet now. It
worked because we were lucky
enough to have a big home, so no oneGermany,
though
regre
sayi
yes
wi
m
th
c
th
hi
the
Fo
sister
share ou
even if it w
ttiming your runwhenays
s
t the
wine. (God
olds their T shirt in was also a practical sgot on top of each other. Our
experience was that lodgers don’t
want to sit and chat with the family
they are living with — they want their
personal space too.
Lodgers largely seem to have fallen
out of fashion, but I wonder if the cost
of living crisis could bring about their
return. After all, they can be good for
the homeowner (who gets free
income) and good for the tenant (who
gets a proper home to live in at a
reasonable rent).
The main attraction for any
homeowner is that you are unlikely topay tax on the income they bring in,
as you can make £7,500 a year —
£625 a month — tax free through the
rent a room scheme. This means
most people in the country won’t
need to tell HM Revenue & Customs
or worry about doing a tax return.
And those whose rent is above this
can deduct the relief to reduce how
much they pay: if you charge your
lodger £900 a month, you only have
to pay tax on £275 (£900 less £625) at
your usual income tax rate.
Anyone taking in a Ukrainian
refugee will receive £350 a monthtax-free from the government, which
means you could do that and still use
the rent a room scheme relief for
another lodger if your home is big
enough.
The relief does not take into
account your costs, so you will have
to pay for the extra energy your
tenant consumes — and it may be
wise to have upfront conversations
from the beginning about short
showers and when you can put the
heating on. (One of my mum’s
lodgers, who shall remain nameless,
took two very long showers a day. No
chat was necessary at the time she
was living with my mum, but these
days it would be different.)
If you feel that your expenses
outweigh the relief — unlikely in
most cases — then you can calculate
tax the usual way, deducting
reasonable costs from the income
and pay tax on what’s left at your
usual rate.
The government doesn’t care how
you find your tenants — you can
advertise on Airbnb if you like — as
long as you’re staying in the home
when they are. (If you are renting out
a property you don’t plan to live in,
you can’t claim rent a room relief.)
There are websites to help you to find
a lodger, even ones that specialise in
Monday-to-Friday lodgers, leaving
you with your home to yourself for
the weekend.
Tenants can also rent out a room,
as long as they are still living in the
home and have permission from their
landlord to sublet.
While most mortgage lenders have
an exclusion for lodgers, and you are
meant to let your provider know if
you are taking one in, most amateur
landlords are not in the habit of
fessing up. Let’s face it, no mortgage
lender is ever going to check — all
they care about is that your mortgage
is paid on time.
We’re going to continue the
tradition with our Greek nanny,
Marina, whom we all adore, and her
cat, Titika. They are going to rent a
room later this summer — we haven’t
yet firmed up the rent but it’s likely to
be in exchange for childcare, which
will be a help for us and allow her to
pay less.
I can’t see her ever putting the
washing machine on for just one item
and we tend to drink all the wine we
have, so there are unlikely to be any
spare bottles to filch. As long as she
hangs up washing the approved
Hewitson way, it should be a very
good way to help beat inflation.ofgoton top ofeach otherOur paLet’s put an end to meaningless estimated bills
In one respect it is a shame that
Rishi Sunak has given everyone
what they wanted — a load of free
money to pay their energy bills.
The hugely rising cost of energy
could have been the greatest
opportunity in a generation to
change our wasteful habits.
A bit like how being locked down
in the pandemic helped many quell
their excessive consumerism.
While there are undoubtedly
millions of households that are
going to be hit very hard when bills
rise again in October, making the
choice between heating and eating
(or sacrificing both in the mostextreme cases), there are also many
who do not really need the help.
They were going to face much
higher costs, but they could afford
to swallow the rises.
Instead what they would have
done, as I know some are doing
already, is make better choices
about their energy consumption.
They would hang washing on the
line, cut back on baths and even
(gasp) turn off the Aga.
Generally they are being more
frugal.
It’s what we need, because
most of us are appalling
energy wasters. Is a huge
chunk of free money going
to solve that? Certainly
not, but really there
was no other way to
deliver the money to
those who need it the
most.
So maybe it is time for
suppliers to shift their
energy habits in the hope of
making us all more conscious
of our usage.Let’s put an end to the estimated
bill for those who don’t want it.
The idea that you should pay an
estimated bill each month, building
up huge credits on your account in
summer and deficits in winter, is
crackpot.
Imagine if supermarkets
operated this way —
charging you less at
Christmas when
you did the big
shop but more
in summer
when
we’re all
on a diet.
You would
think they
had been at
the value-brand
vodka.
Estimated bills fool us
about our energy
consumption, kidding us
into using more in winter
because we never pay the real
amount.
The system doesn’t help usbudget through the year, as
suppliers like to claim, because
they seem to make up our
estimated monthly bills anyway.
Rather they use the millions in
credit balances as a slush fund to
keep their operations afloat.
Millions of homes now
have smart energy
meters that
automatically feed
back readings to
suppliers — there
is no excuse not to
charge us the
correct amount.
Estimated bills
make a nonsense of
the claims that smart
meters help you save
money.
Those without smart meters
should be allowed to submit
readings every month to pay their
real debt if they want to.
We all need to manage our
energy usage better — time for
suppliers to let us.
@jimconeyJames
Coney
Money
editor
Comment
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