Tax Return help - Rental Income

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qwertyqwerty
qwertyqwerty Posts: 131 Forumite
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Hi I am struggling to work out why my tax bill for the year has come out higher than expected.

My bill due for this year is £1286

I have rental income of £550 per month. Of which £445 per month goes to pay the interest only mortgage. I also have expenses totaling around £1000 for boiler replacement and insurance. so my taxable profit for the year is £260.

The only change in my working conditions for the financial year is that I changed employment in June 2016 but all my taxes have been paid through PAYE. I just cant understand why the tax due is so high?

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  • TheCyclingProgrammer
    TheCyclingProgrammer Posts: 3,702 Forumite
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    edited 3 January 2018 at 12:21AM
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    Could you have underpaid tax in your PAYE job? You’ll need to post your full tax return figures to get any useful help.
  • 00ec25
    00ec25 Posts: 9,123 Forumite
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    without knowing your employment income and tax paid in it all we can do is play pointless guessing games
  • qwertyqwerty
    qwertyqwerty Posts: 131 Forumite
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    Employment up to June 16

    7804.00

    Tax taken off: 1011.00

    Employment from June 16:

    31446.00
    Tax taken off: 4638.00

    This information is from HMRC, I guess sourced from my p45 and p60
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
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    If you have only entered details of the two employments referred to in your latest post and rental profits of £260 then the tax due would be more like £53.

    You need to give us the make up of the calculation to know where the £1286 is derived from.
  • oconnor_m2000
    oconnor_m2000 Posts: 5 Forumite
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    Hi,
    recent changes to the calculation of taxes for rental income could be the reason behind why your rental income is higher than your income. In the past, 100% of the interest element of the mortgage could be taken into consideration, this is no longer the case. Secondly, the 10% wear & tear allowance is no longer available. Enter details of S24 tax changes for landords on the internet
  • [Deleted User]
    [Deleted User] Posts: 0 Newbie
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    oconnor_m2000 wrote: »
    Hi,
    recent changes to the calculation of taxes for rental income could be the reason behind why your rental income is higher than your income. In the past, 100% of the interest element of the mortgage could be taken into consideration, this is no longer the case. Secondly, the 10% wear & tear allowance is no longer available. Enter details of S24 tax changes for landords on the internet

    The op has provided us with full details of income and expenditure - no W & T allowance claimed. The op is also a basic rate taxpayer and so I am not sure of the relevance of your point regarding the interest.
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
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    Particularly given the op is presumably trying to complete their 2016:17 return and the interest changes only apply from the current, 2017:18, tax year.

    NB. I know op referred to tax bill for "this year" but it is unusual to be trying to file a return part way through the current year
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