Answers · UK 2025/26

How do I pay tax on Airbnb income in the UK?

Airbnb income is taxable and must be reported to HMRC once it exceeds £1,000 gross in a tax year (or the £7,500 Rent a Room threshold if letting a room in your own main home). Above the relevant threshold, you register for Self Assessment and pay Income Tax at your marginal rate on the profit, after deducting allowable expenses.

Last updated: 2 July 2026Last reviewed: 2 July 2026How we verify

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Short-let income through platforms like Airbnb is taxed differently depending on whether you are letting a room in your own home or a whole separate property, and Airbnb also now reports UK host earnings directly to HMRC, making accurate declaration essential. **Letting a room in your main home** If you are hosting guests in a room within your own main residence, the generous Rent a Room Scheme threshold of £7,500 tax-free (£3,750 if shared with a partner) applies, and income above that is taxed either using the Rent a Room simplified method or the normal expenses method, whichever produces the lower bill. **Letting a whole separate property** If you let an entire property (or a property that is not your own main home) via Airbnb, the £1,000 property income allowance applies instead of the Rent a Room threshold -- above £1,000 gross income, you must register for Self Assessment and can deduct either the flat £1,000 allowance or your actual expenses. **Allowable expenses** For a whole-property let, allowable expenses can include a proportion of utility bills, cleaning costs, platform service fees, insurance, council tax (if you are liable), and wear-and-tear replacement of furnishings -- capital costs like the initial purchase or major renovation are generally not deductible against income tax in the same way, though they may be relevant for Capital Gains Tax when you eventually sell. **Furnished Holiday Lettings (FHL) rules abolished** The furnished holiday lettings tax regime, which previously gave short-let properties more favourable tax treatment than standard buy-to-let (including full mortgage interest deductibility and pension contribution eligibility on profits), was abolished from April 2025 -- short lets are now generally taxed under the same rules as standard residential lettings, including the Section 24 finance cost restriction limiting mortgage interest relief to a basic-rate tax credit. **VAT considerations for high-volume hosts** If your total Airbnb turnover (combined with any other business income) exceeds the £90,000 VAT registration threshold, you may need to register for VAT, which adds complexity to short-let hosting at scale. **Worked example** Someone lets a spare flat via Airbnb, earning £14,000 gross in the year with £3,000 of allowable expenses (cleaning, fees, utilities). Taxable profit is £11,000, taxed at their marginal Income Tax rate through Self Assessment -- at basic rate, that is £2,200 tax due. **Practical tip** Keep detailed digital records of all income and expenses through the year (Airbnb's own payout reports are a good starting point), since HMRC receives data directly from platforms and discrepancies between reported platform income and your Self Assessment return can trigger enquiries.