Overview
- AJ Bell’s Laura Suter and regional outlets outline how Rent‑a‑Room relief, tax‑free childcare and the starting‑rate savings allowance can combine to deliver roughly £27,070 of effective tax‑free income for eligible households.
- Under Rent‑a‑Room, up to £7,500 a year from letting a furnished room in your main home is tax‑free, with no reporting needed below the threshold and self‑assessment required if income exceeds it.
- If a room is let jointly, each person can claim up to £3,750 tax‑free, and the scheme can apply to homeowners or tenants, including B&B or guest‑house activity within the main residence.
- Tax‑free childcare provides up to £2,000 per child annually via a dedicated account, with the government adding £2 for every £8 paid in and funds typically released in quarterly £500 tranches.
- The £5,000 starting‑rate for savings applies in full when earned income is at or below £12,570 and tapers off pound‑for‑pound until £17,570, reinforcing that outcomes depend on individual income and eligibility.