Rental sharing tax with four owners.

HHBB · 5 February 2018 at 5:45AM

Grateful for any clarification of the scenario of two married couples, through inheritance, sharing a quarter each of the rental of a house. Normally, the rental profits would be taxed 50/50 between spouses, but could be 90/10 between non-spouses.
Would it therefore be possible for the two non-spouses to have an arrangement, so that the two non-taxpayers wives could take the higher percentage of the rental against the other's higher paying tax husband ?
HMRC don't appear to have a clarification of this scenario on their help pages.
Thank you.

Tom99 · 5 February 2018 at 9:08AM

[FONT=Verdana, sans-serif]If it was a death less than two year ago which resulted in this inheritance then with a deed of variation the parties can arrange ownership to whatever proportions they like.[/FONT]

kidmugsy · 5 February 2018 at 6:32PM

What's the objection to the two high-earning spouses gifting most or all of their ownership fractions to their low-earning spouses?

[Deleted User] · 5 February 2018 at 6:43PM

kidmugsy wrote: »

What's the objection to the two high-earning spouses gifting most or all of their ownership fractions to their low-earning spouses?

Indeed. And one must ask - what is the tax saving here? On a profit of £4000 the saving would be £400 a year in tax. However, upon sale two CGT allowances would have vanished while the rate of CGT on half the gain would reduce by 10%. Is this a case of the tax tail wagging the dog?

Rental sharing tax with four owners.

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