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Income from Airbnb or any other short-term rental, must be reported to HMRC if the total amount you receive from it in a tax year, is more than £1,000.
To pay tax, you’ll need to register for Self-assessment by 5th October following the end of the tax year that you need to report income for.
To calculate taxable profit, you can deduct from your income £1000 allowance or allowable expenses if your expenses were more than £1000.
There are special rules for Furnished holiday lettings, to qualify :
Total of letting exceeding 31 days, can’t be more than 155 days in the year.
Property must be available for more than 210 days a year, you can’t stay in the property in that time.
All properties are treated as one business and must meet above conditions.
If you don’t qualify, you can claim expenses for :
general maintenance and repairs to the property, but not improvements
costs of services, including the wages of gardeners and cleaners
water rates, council tax, gas and electricity
mortgage interest – depending on the circumstances
accountant’s fees