QB 19/06
Issued
20 May 2019

What income tax rules apply if I have a dwelling that I sometimes rent out as short-stay accommodation and sometimes use myself?

Dwellings used privately and also rented out

You may be providing accommodation in a separate property or dwelling that’s not your own home, but that you sometimes use privately. For instance, you may have a holiday home you sometimes use yourself and sometimes rent out. Another example is a sleepout on your property that you sometimes rent out and sometimes use as accommodation for family or friends.

In these situations, there are different rules for apportioning your expenditure between income-earning use and private use that could potentially apply. The different rules are:

The “mixed-use asset” rules OR The standard tax rules

You will need to work out which rules apply so you can meet your income tax obligations. The key factor is whether the property is unused for 62 days or more in the income year. If it is unused for 62 days or more, the “mixed-use asset rules” apply. Otherwise, the standard tax rules apply.

We recommend that you read our Short-stay accommodation overview to find the QWBA most relevant to your situation.