Private stable. Can I charge?

[Rossi]

I have stables for three horses, 1 menage and 3 acres. My friend stables her horses here and uses all facilities including water and electric. I've done this as a favour and not charged her. Can I start charging her to help towards the wear and tear (which is happening and the energy/water she is using, without going through planning and changing the use from Private to Commercial (and all the stuff which goes with that)!

 

[MiCsarah]

Id say yes and get cash in hand (naughty im sure)

 

[noodle_]

what!?! you dont charge!!?


erm yes.... and id be paying around £80 a week for what you describe!!!!

 

[sprite1978]

yes...tell her that there are jobs that need doing due to wear and tear and energy bills are rising, and you need a contibution. But be careful, that she may be looking for visible signs that the wear and tear is being dealt with. Its difficult because you havent charged from the start.

 

[liveryblues]

I think if she is a friend, she would understand that something towards the use of all that would not be asking too much! I am sure any number of us would kill for a set up like that and be only to happy to pay our way!
She doesn't expect to stay for free, surely?
In answer to your question if you want it all above board I expect there are hoops you have to jump through to make it so! but an agreement between friends, were one understands that helping out financially is fair, im sure you dont need paperwork for that

 

[AmyMay]

Yes, of course.

If she's DIY - then around £25 a week. I'm amazed she hasn't offered you anything to be honest.

 

[lachlanandmarcus]

Its a bit of a grey area, does taking any money mean that the planning is breached, tricky q. Personally I would say with only one livery who is a friend and only 3 stables, it is more a case of them contributing to the costs and not a commercial enterprise.

I would declare the income tho on your tax return. Planning wise, if the friend fell out with you and reported you, in all likelihood they would tell you to stop renting the stable. Then friend has no home for horse. So its not in her interests to report you, nor are the consequences if it happens too serious.

I would ask her to contribute and base it on the costs of maintenance, proportion of renewal eg of manege surface every x years, water/elec costs etc. That would help to show the planners if they query that its not for commercial gain.

I wouldnt provide livery for free unless they were eg providing all the mucking out etc and holiday cover for my horses as payment in kind! People dont value things they pay nothing at all for.

 

[forestfantasy]

Yes, of course.

If she's DIY - then around £25 a week. I'm amazed she hasn't offered you anything to be honest.

This 100% !

 

[ladyt25]

You're bonkers not charging and I can't believe your friend's not offered! I don't think you have to declare it to the tax man if it's under a certain amount a year - not sure what it is though. I know with say getting a lodger for your house you can charge up to (I think) about £4500 a year before you have to oay tax on it so it would probably be the same or similar as far as a yard is concerned. If they have more than one horse there then they should be expecting to pay for facilities - god, they must be rubbing their hands together!!!

Obviously if this friend is also say taking care of your horses or does anything else for you in return for the stabling then that's a different matter.

 

[dunkley]

Yes, of course.

If she's DIY - then around £25 a week. I'm amazed she hasn't offered you anything to be honest.

Per horse!

 

[MiCsarah]

I pay my livery off with work so if she is doing alot to help with your horses I wouldnt expect her to pay but if shes not then I would definatly be charging.You wouldnt build a house and allow somebody to live there for free

 

[CatStew]

You're obviously a very good friend to have!

I'm surprised that she hasn't offered anything towards the upkeep of your property to be honest. I think that its more then fair of you to ask for a contribution towards costs. I wouldn't like to comment with regards to paying tax etc as I wouldn't have a clue!

Just to give you an idea, my horses are on DIY and I pay £142 a month per horse. This includes the stable, electricity and water as well as hay and straw, the facilities include daily turnout, unlimited use of a lunge/loose school pen, a decent sized floodlit outdoor school (slightly bigger then 20x40) and use of a jumping paddock with full set of jumps. There is also a secure alarmed tack room, a guard dog and YO lives on site. They also repair fencing and stabling if required, as well as replace any lightbulbs etc on the yard/stables/tackroom/barn.

Sorry if this has veered a bit off topic

 

[miller]

Afraid by the letter of the law you need to notify HMRC - and would also potentially require PL insurance as YO

I have to nitfy HMRC of the £100 odd I get a year for the telegraph poles on my land as wayleave as it is classed as 'renting' so is 'income'

Have known someone be 'investigated' for this and made to back pay - be careful any of you that do it!

Agreed though, can't understand your friend hasn't offered

 

[juliette]

In my opinion you should charge, I keep my horse at a friends and I pay. She didn't ask for anything when I first went there, but I insisted. I'd have felt awful using the hose, turning on a light, watching the field be fertilized etc if I was not contributing.

 

[lachlanandmarcus]

The exemption for rent a room mentioned in an earlier post was a specific HMRC exemption to reduce reposessions and homelessness in domestic houses and def doesnt apply to horse livery; apart from that exemption any income has to be declared.

You may or may not have to fill in a tax return if your total income incl any employment and the livery is under the tax threshold of £7,5k ish; the easiest way if you dont at the mo is to tell HMRC about the income and let them decide and if they do send you onethey will prob do it for one year and after that they look at it and decide you arent worth sending one to (like they did with me, and i havent had one since).

I wouldnt let all that put you off, and I dont think the planning question should either. Your friend should not be freeloading from you and as horsey costs get ever higher that becomes even more the case. Even if you only ask for a contribution to costs, its an important principle. After all, if you wanted another horse to pay for, youd probably have got one!

 

[FRESHMAN]

Afraid by the letter of the law you need to notify HMRC - and would also potentially require PL insurance as YO

I have to nitfy HMRC of the £100 odd I get a year for the telegraph poles on my land as wayleave as it is classed as 'renting' so is 'income'

Have known someone be 'investigated' for this and made to back pay - be careful any of you that do it!

Agreed though, can't understand your friend hasn't offered

Thank god for some common sense. Most if not all private residential stables & facilities actually have a clause attached. Only to be used by the residents & family of the house. Must not receive any financial gain! Yes you are liable for income tax on any income (which is exactly what stable rent is, same as renting a garage etc) You can call it helping towards costs, or whatever you like. Makes no difference. You are also liable for NNDR (commercial rates) plus additional VAT on commercial use electricity. Then you have public liability insurance. Believe.me if that horse gets out & causes an accident you as landowner will be held responsible.
Doesn't sound quite as healthy now does it?
Welcome to the real world of legitimate YO's trying to make a living, have a huge investment & not a level playing field in sight.

 

[Holly Hocks]

Thank god for some common sense. Most if not all private residential stables & facilities actually have a clause attached. Only to be used by the residents & family of the house. Must not receive any financial gain! Yes you are liable for income tax on any income (which is exactly what stable rent is, same as renting a garage etc) You can call it helping towards costs, or whatever you like. Makes no difference. You are also liable for NNDR (commercial rates) plus additional VAT on commercial use electricity. Then you have public liability insurance. Believe.me if that horse gets out & causes an accident you as landowner will be held responsible.
Doesn't sound quite as healthy now does it?
Welcome to the real world of legitimate YO's trying to make a living, have a huge investment & not a level playing field in sight.

I agree with the above - although even if the stables are rated for NNDR, there is unlikely to be a charge as the RV will be below the chargeable value with only 3 stables. Plus if you don't have any other businesses in your name you will be eligible to apply for SBRR (Small Business Rates Relief) which will definitely mean that a the value yours would be put at there would be nothing to pay.
You must get PL insurance
The income can be offset by the expenditure - it's quite simple. Keep a record of the income and receipts for expenditure - there may be no profit at the end of it, but you do need to be above board. You never know what busybody nosey neighbours are ready to grass you up!

 

[FRESHMAN]

Beg to differ Holly Hocks. NNDR is exactly what it says on the tin. A national rate so that all premises are treated the same. (difference in London rates) all stables available to rent are now averaged at £180 to £200 pa so £190 pa is a good base x 3 = £570 plus a menage at approx £6 per m2 This I think is about 800m2 so £4800 pa. paddocks approx £12 each for small acreage. That is now totalling £5406 per annum RV. This doesnt include any storage/ tack feed etc which runs about £10 m2. It all soon adds up & trust me they will chase for it.
My apologies if area is incorrect as useless at remembering these things. I currently pay £9490 pa & that is with £4000 stud relief. It is very hard to cover these costs when people want a stable as cheap as chips.

 

[indie999]

I only ever pay £15 per week per horse although I did rent a private homes field too with stables etc field for £65 per month no limit on horses! These were private homes at the time and not long ago. If they damaged anything I would pay etc. I got allown hay/ rid of poos etc myself

 

[FRESHMAN]

When you say private homes stables & field I presume you mean a private house that happens to have stables & a field? If so, can you see why legit YO's struggle to keep head above water. Until we license yards & all have to provide good safe facilities & pay the rates that come with it, we can not improve standards. Or stop the nightmare stories you often read about so called livery yards & owners.

 

[Holly Hocks]

Beg to differ Holly Hocks. NNDR is exactly what it says on the tin. A national rate so that all premises are treated the same. (difference in London rates) all stables available to rent are now averaged at £180 to £200 pa so £190 pa is a good base x 3 = £570 plus a menage at approx £6 per m2 This I think is about 800m2 so £4800 pa. paddocks approx £12 each for small acreage. That is now totalling £5406 per annum RV. This doesnt include any storage/ tack feed etc which runs about £10 m2. It all soon adds up & trust me they will chase for it.
My apologies if area is incorrect as useless at remembering these things. I currently pay £9490 pa & that is with £4000 stud relief. It is very hard to cover these costs when people want a stable as cheap as chips.

Freshman I have helped a couple of stables get their NNDR rates reduced considerably - you need to know how to successfully appeal the system

I know of one stud paying £1 per square metre for their outdoor sand school, and £2.50 per square metre for their indoor school.
It's all there on the VOA website - you can check the rates that anyone is paying and what they are paying it for. If you can find this information, you can use it as evidence for an appeal.

 

[Holly Hocks]

When you say private homes stables & field I presume you mean a private house that happens to have stables & a field? If so, can you see why legit YO's struggle to keep head above water. Until we license yards & all have to provide good safe facilities & pay the rates that come with it, we can not improve standards. Or stop the nightmare stories you often read about so called livery yards & owners.

Totally agree with licensing livery yards....I was only thinking about this earlier today....

 

[coss]

Its a bit of a grey area, does taking any money mean that the planning is breached, tricky q. Personally I would say with only one livery who is a friend and only 3 stables, it is more a case of them contributing to the costs and not a commercial enterprise.

I would declare the income tho on your tax return. Planning wise, if the friend fell out with you and reported you, in all likelihood they would tell you to stop renting the stable. Then friend has no home for horse. So its not in her interests to report you, nor are the consequences if it happens too serious.

I would ask her to contribute and base it on the costs of maintenance, proportion of renewal eg of manege surface every x years, water/elec costs etc. That would help to show the planners if they query that its not for commercial gain.

I wouldnt provide livery for free unless they were eg providing all the mucking out etc and holiday cover for my horses as payment in kind! People dont value things they pay nothing at all for.

This althought if you claim in on your income, then you need to state expenses too - ie, if she paid you £10 for facilities, and here horses drank £10 of water, your income would be £0

 

[FRESHMAN]

lol trust me Holly Hocks, I have done all of it! Even had a Consultant as last ditch attempt! I did get a reduction of RV £20,000 which just goes to show what a stupid system we have.
Got this sorted through appeals & a tribunal in Sept 09 & in April 10 (new rating list) they put the RV up by £15,000 ( basically 6 months) what was the point I ask.
I have checked out all other comparables on the list, they are at least being charged approx the same amounts per m2.

 

[jon1210]

you can charge up to (I think) about £4500 a year before you have to oay tax on it

Didnt this get raised upto £7000 recently ??

 

[Holly Hocks]

lol trust me Holly Hocks, I have done all of it! Even had a Consultant as last ditch attempt! I did get a reduction of RV £20,000 which just goes to show what a stupid system we have.
Got this sorted through appeals & a tribunal in Sept 09 & in April 10 (new rating list) they put the RV up by £15,000 ( basically 6 months) what was the point I ask.
I have checked out all other comparables on the list, they are at least being charged approx the same amounts per m2.

Oh that's awful!! Let's hope they start to license yards and at least we would have adequate grazing, fencing and all the rest that we need for our horses. I would much rather have mine on a licensed yard where the person who runs it knows what they are doing. But finding decent yards is difficult, nigh on impossible! If I were nearer I could come to yours!!

The problem we have in my area is that there are too many people looking for livery and not enough yards! Nowhere ever has space!

 

[FRESHMAN]

I would think whatever you charge rents will be added to any other income you may have. So although I accept this is an assumption I would presume that someone owning a property with land & stables & a menage would either be: already working, maybe a couple with professional full time jobs or someone in business. Either way the income whatever it may be will be totted onto existing income & taxed in full accordingly. I know people with a 2nd job ( even quite low income brackets & 2nd job is taxed at source across the full gross amount. One of the my sons who is a student earns up to the tax & NI threshholds, his 2nd p/t peanuts job gets taxed in full.

 

[FRESHMAN]

Holly Hocks. Licensing is the only way forward. On that basis all facilities should be kept to good standards. Every yard would be legitimate & therfore all of them would have to carry PL Insurance. Pay rates, & give a good service. It would stop the local farmer or someone with a bit of land & spare stables (from the kids younger days) from undercutting the people who put heart & soul into their yards.

 

[honetpot]

While I can see that if you are running a livery yard you must be really p****d off with people charging for livery when they do not follow rules,rates etc. But I think someone having a friends horse at their house and asking to put towards the costs is the difference between having someone to stay at your house and paying for the grocery shop and running a small hotel. The difference being if you rented out a room in your house you would not be taxed on the income, I think as long as there is no lock on the bedroom door. We need a tax whizz.
As someone has said their will be no net income from this as the costs surely would out weigh any financial gain, and you are taxed on income after expenses. So even if you declared the 'income', the expenses ( keep all the reciepts)would would probablely end up in a negative amount so would make no difference to the amount of tax you paid.
I would look at the insurance side, I have recently taken out a policy on a house and you are charged per livery but I would make sure she had her own 3rd party insurance.
I can understand why anyone would want to run a livery yard as very few horse owner seem to understand the finances when they moan they are paying £25 a week.

 

[Ladydragon]

I have stables for three horses, 1 menage and 3 acres. My friend stables her horses here and uses all facilities including water and electric. I've done this as a favour and not charged her. Can I start charging her to help towards the wear and tear (which is happening and the energy/water she is using, without going through planning and changing the use from Private to Commercial (and all the stuff which goes with that)!

Personally, I'd not want to get involved with the change of use etc unless I was planning on using the stables for livery on a business basis full stop with a realistic charging/contract set up - what if she leaves the week after you've done all the faffing around and incurred financial costs purely to accommodate her using them?

If she's a real friend I can't believe she hasn't shoved some money in your pocket to pay her way a little... She's having a bit of a laugh... And to be honest, if your friendship is that one sided I'd not be at all bothered about telling her to sling her hook and find somewhere else...

If you do want to use the stables for a business enterprise - get good advice (quite a bit of knowledge on this thread) and be prepared to charge appropriately - which might still mean telling her to sling her hook...

Sorry if that sounds a bit blunt but I'm amazed that a 'friend' can take advantage so brazenly... Unless, of course, she's returning the favour in non financial ways...