How to split rent and bills fairly

Getting it wrong could cause arguments or even land you in financial trouble. It’s vital that you are comfortable talking about money with the people you share a home with. 

When you move into rented accommodation, it’s important that you know who is on the tenancy agreement.

If you have a sole or joint tenancy it will make a difference as to who is liable to pay your landlord if one housemate stops paying rent or moves out before the tenancy ends.

This can get quite complicated so it’s well worth looking at our guide to Your legal and financial responsibilities when renting. 

If you are comfortable sharing the total rent between you and you’re trying to decide who should pay which share of your monthly rent, you have a few options:

This can often seem like the fairest method of splitting your rent, and it’s certainly the easiest to work out. 

However, it’s not always so simple. It could work out as a better deal for the housemate with the biggest room, while couples sharing one bedroom might be paying over the odds.

Most houses don’t have identically sized bedrooms, so is it fair to rent them for equal amounts? It’s a good idea to sit down with your housemates to see what you think is a fair price to charge for each room. 

Size isn’t the only factor either. Consider whether rooms have an en suite, or if the tenant would need to share a bathroom when you’re deciding which bedroom should be more expensive. It could also be worth charging couples more rent than a single person, especially if your rent includes utility bills.

Another option is to charge each tenant a percentage of the monthly rent based on their salary. This is probably only something you’d consider if you’re renting with a partner, but it can work out well if there’s a significant difference in income between you.

The way you can work this out is to look at everyone’s take-home pay, work that out as a percentage of the full household income then you’d each pay that percentage of the total rent.

If you live in a property where utilities aren’t included in your rent, you’re also going to need to work out how to split your bills between you and your housemates.

Keeping on top of bills can be a real headache and the consequences of not paying some bills, such as gas or electricity, Council Tax or the TV Licence can be serious.  

For household bills, any person named on the account is liable for paying them. It’s important to know this, as if someone skips off without paying their bill or falls behind with payments, it will be left to the named bill payer/s to make up the shortfall.

To make things simple, it’s usually best to decide who’ll have the Direct Debits for the house’s bills taken out of their account. And to avoid the bill payer having to chase up the others for money, everyone else should set up a standing order to transfer over that amount every month. 

You can then use a spreadsheet to work out all the bills that the household needs to pay each month, as well as estimates for quarterly or annual bills like water or contents insurance and come up with the amount each housemate needs to pay. It could be helpful to find out how much the average UK household spends on bills.

If your housemates stop contributing towards bills, and don’t offer to pay the money back, it’s possible to get back any money owed to you through small claims courts.

Citizens Advice has more information about what to do if your housemates won’t pay

In most cases, it’s not recommended for housemates to open a joint bank account. Holding a bank account with someone will link your credit histories and could affect yours negatively.

It’s best to avoid opening a joint account unless it’s with someone you trust. Remember, account holders will not only be able to pay into the account, but they can withdraw from it too.

When you move in with your partner you should have a conversation about how you’re planning on splitting the household bills you’re both going to use. If you don’t do this, it could result in payments being missed or made late and could leave a mark on your credit file, and for some bills you could get a court summons.

Some couples choose not to split their household bills down the middle. It’s a personal choice; it could be because one of you requires expensive broadband, and the other doesn’t want to pay for it, or due to a large wage disparity. 

If you do choose to share out bills based on how much you earn, there are a couple of options. You could either split your bills by percentages as illustrated above or divide out the list of bills so that you each are responsible for different ones. 

It can be difficult to keep track of who owes what to who within a household. Helpfully, there are several free apps that can work it out for you.

Many have features that tally up less regular expenses like supermarket shopping and shared takeaways, so you can transfer all of the money owed in one go instead of remembering to send over lots of smaller amounts. If all the people you usually split your bills with all have smartphones, it could be an easier way of making sure everyone pays their fair share.

Look for bill splitting apps that are well reviewed on your app store if you want to try one out. There are plenty of free options, so don’t feel like you need to spend money on one.

Getting the bill at the end of a restaurant meal can often end up as a complicated equation to work out who should pay which amount. 

Dividing the total by the number of diners is usually the quickest way to sort out who should pay what at the end of the meal. If you all had the same number of courses and drinks it should only be a couple of pounds more or less than the true total of what you ordered. 

If one member of your party ate salad and tap water, it’s probably unfair to have them fork out for a share of the meal of someone who ordered Champagne and caviar. 

It’s best to keep track of what you ate and drank yourself and check your numbers against what it says on the receipt. This is the fairest way to split the bill, but you must make sure that what everyone pays will meet or exceed what your group owes the restaurant. 

When totting up your restaurant bill, make sure you pay your fair share of any tips or service charge that might be added. If you’re in a larger group, it may be added to your total automatically at some restaurants. If you don’t remember to add it to the amount you pay, the person who gets handed the card machine last could be in for a nasty surprise.