My client runs a small hotel/ guesthouse in partnership with his wife.
The wife's mother is ill and rather than go into a home they are proposing that she moves into the house.
She will help to pay for the mortgage in return (or give money to my clients so that they can pay it).
Is this taxable income of the business or can this be treated as a gift from mother to daughter. This solution is cheaper than her going into a home.
Any guidance would be appreciated.
Rob
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It used to be the case
That where people shared accommodation, living as family members would and contributed towards the costs, that contribution was not taxable. I say "used to" as I can't find it anywhere now, but if your client's wife's mother moved in and lived with them as a family member, sharing meals and living areas etc, any contribution she made would not be taxable.
Perhaps some bright spark can confirm if this still applies, or perhaps it was removed when rent-a-room came in.