BIM86005 | TMIA – Definitions: Relevant Trade

A relevant trade is any trade carried on by an individual not trading as a partnership, and not a rent-a-room trade. This means that a trade carried on in partnership with others is not a relevant trade, nor is a rent-a-room trade (this is set out in S783AA ITTOIA 2005).

A rent-a-room trade is one where the individual qualifies for rent-a-room relief for the tax year and the individual has rent-a-room receipts. More information on rent-a-room relief can be found at PIM4001. See BIM86034 for more information about rent-a-room receipts.

In some circumstances profit from running property businesses can be taxed under the trading income rules - in these circumstances the trading and miscellaneous income allowance can be used against this income. See PIM4300 for more information relating to these circumstances.

For more information regarding the existence of a partnership see HMRC’s Business Income Manual at BIM86008.