A mere three months into his time as MP, Julian Knight successfully saw a key tax change passed in last week’s Budget. The change concerned the rent-a-room scheme, which allows tax exemption for homeowners who rent a room to a lodger.The amount of money people could earn tax-free had previously been frozen at £4,250 – unchanged since 1997. Thanks to Julian’s submission, the threshold will now rise to £7,500.
Julian, a former property journalist, first raised the issue in a debate on Home Ownership in July. He asked the Treasury Minister if the tax-free threshold could be brought up to date to help out aspiration homeowners, in particular homeowners in Solihull who rent out rooms to meet their mortgage repayments. The Treasury Minister directed it to the Chancellor, which Julian followed up in writing. He was supported by flat and houseshare site Spareroom.co.uk, who had been campaigning for a change in the law for the past six years. Spareroom.co.uk established a petition to raise the limit, which gained over 20,000 signatures online.
Julian says: “I am absolutely delighted that the Chancellor has listened to my campaign to dramatically raise the rent-a-room scheme allowance. This move will bring joy to many hard pressed Solihull home owners who rely on the income from taking in a lodger and renting out a room.
“What is really telling about what the Chancellor has done is that he has raised the allowance by such a large amount that it has made up for 20 years of inflation.
“It really is a thrill, 6 weeks into the Parliament, to see a major policy suggestion of mine adopted by the Government. People can rest assured that Solihull is having its voice heard.”
Matt Hutchinson, director of SpareRoom.co.uk, praised Julian for his work in getting the submission through. “The Chancellor’s update to the Rent A Room scheme, which has remained unchanged for 18 years, has potentially huge implications for the supply of affordable rented accommodation. Julian’s support and his Budget submission were instrumental in pushing our campaign over the finish line and we’re grateful for his hard work.”