Accidental landlord

tbs624

inmypocketnottheirs wrote: »

As the property is a flat, if it is in England or Wales then it will be a leasehold property. If this is the case the freeholder arranges the insurance.

We can see now that the property is in Scotland but with some leasehold flats have lease clauses requiring the lessee to arrange their own buildings insurance. Either way, if you were proposing to let the property, you should still notify the insurance provider: it would be your responsibility as a LL to make sure that cover was adequate for your purposes.

tbs624

Jules - has your partner registered as a LL with the local council as required to do under Scottish law?

theartfullodger

TBS is right: See
https://www.landlordregistrationscotland.gov.uk/Pages/Process.aspx?Command=ShowHomePage

I know a neigbhour who hasn't - 'twill be intersting when someone tells the authorities (someone will, you can guarantee it). I think it can be a criminal offence not to.


I'd also suggest 4 things
a) Join SAL (The English Landlord's associations don't really understand Scottish Law) see
http://www.scottishlandlords.com/
(For help when it all goes wrong!)
b) Get onto..
http://www.landlordaccreditationscotland.com/
c) Deposits: Do what you like in Scotland, but best practice says keep them separate. I ask for 1.5months deposit.

Cheers & Welcome to the fun world of letting!

Lodger

GDB2222

Has he considered the possibility that he might be better off selling now, even though the market is difficult? Can he afford to sell in two years time if prices are then say 20% lower than now? If not, could he end up being locked into the mortgage on the flat indefinitely?

XXJULESXX

Thanks again for all this.

We're not sure about the mortgage til he speaks to Northern rock, but yeah, he would need to look into being locked in, which would be a worry.

Yes I realise this will affect the buildings Insurance and I know about registering as a landlord with the council.

As he bought the property more than 10years ago he doesn't have a HIP or EPC, but I'm guessing the one we need for letting out is the same one that you have to organise when selling?

Atleast the deposit seems straight forward then in Scotland - for now. And we know about the gas, the electrical and the fire safety checks which seem pretty straighforward.
Thanks for all advice so far.

silvercar

If he rents it for less than 3 years before selling, there will be no CGT liability. Even if he lets it for more than that, there are reliefs available (letting relief, personal CGT allowance) before any CGT would be due. So no worries about capital gains tax.

If his costs, including the interest on the mortgage, exceed the rental income then there will be no income tax to pay. The rental income should be included in the tax return each year, but there is no need to pre-register as a self employed landlord for the amount of rent I imagine you would get.

silvercar

angrypirate wrote: »

You should also need to speak to you LHA to find out if the change in status affects the entitlement to the place you are renting.

I doubt moving a boyfriend in could effect your entitlement to your tenancy.

GDB2222

silvercar wrote: »

I doubt moving a boyfriend in could effect your entitlement to your tenancy.

It would affect your entitlement to benefits, though.

Idiophreak

silvercar wrote: »

I doubt moving a boyfriend in could effect your entitlement to your tenancy.

Doesn't it?

I don't understand these things and I'm *not* having a go at the OP, but could someone really still be entitled to a HA property if their millionaire boyfriend moved in with them?

GDB2222

Idiophreak wrote: »

Doesn't it?

I don't understand these things and I'm *not* having a go at the OP, but could someone really still be entitled to a HA property if their millionaire boyfriend moved in with them?

It's normally an Assured Tenancy (not Shorthold), so yes.