Annex or not an annexe?!

Don74

Lots of people have lodgers in to help raise cash. I have followed all building regs and fire regs, My mortgage company is aware as are my insurance. The only real dishonest thing is not declaring the full amount of rental income. The issue here is what the council classes as an annex and it is this fact I have come to this forum for. All I wanted was to have a lodger and a bit of privacy as well, not much to ask for, but the council want you to pay extra council tax for this. Perhaps you agree with council tax, I always thought it depended on the property value as it was in the 1930s, why should mine change just because I got a lodger in. Perhaps they need the money to put into an offshore account and we are the dishonest ones eh!

I can see that I am getting no-where on this forum as none of you have never done anything wrong in your lives and fully agree with whatever the government deems right. We are getting taxed to death in this country and there are plenty of people who do a lot worse than me in trying to avoid it.

Thanks Planning_Permission for your advice which was helpful, at least I know that applying for planning permission would be very risky as they would indeed inspect the property. So it looks like I'm stuck with being dishonest because the alternative means it wouldn't be worth the process in the first place.

If anyone else has any ideas on how to lower my mortgage in a house I can't sell, feel free.

macman

You are in effect creating two dwelling units, therefore it's not unreasonable that both should pay council tax, your 'lodger' will be using those services in addition to your family.
A lodger would not normally have separate eating and washing facilities, they would share those and just have their own bedroom.

edgex

Don74 wrote: »

Lots of people have lodgers in to help raise cash. I have followed all building regs and fire regs, My mortgage company is aware as are my insurance. The only real dishonest thing is not declaring the full amount of rental income. The issue here is what the council classes as an annex and it is this fact I have come to this forum for. All I wanted was to have a lodger and a bit of privacy as well, not much to ask for, but the council want you to pay extra council tax for this. Perhaps you agree with council tax, I always thought it depended on the property value as it was in the 1930s, why should mine change just because I got a lodger in. Perhaps they need the money to put into an offshore account and we are the dishonest ones eh!

I can see that I am getting no-where on this forum as none of you have never done anything wrong in your lives and fully agree with whatever the government deems right. We are getting taxed to death in this country and there are plenty of people who do a lot worse than me in trying to avoid it.

Thanks Planning_Permission for your advice which was helpful, at least I know that applying for planning permission would be very risky as they would indeed inspect the property. So it looks like I'm stuck with being dishonest because the alternative means it wouldn't be worth the process in the first place.

If anyone else has any ideas on how to lower my mortgage in a house I can't sell, feel free.

but this is patently incorrect

you havnt got a lodger in, you dont want a lodger in
you are trying to find some way of turning a house (1 dwelling) into 2 flats (2 dwellings), without going through the proper, legal, processes.

a lodger is someone that shares 1 dwelling with the main occupants, they would have their own bedroom, but would usually share all other facilities, & would share a front door, address etc.
you are trying to give this additional person all their own facilities on one level, with your own facilities on another. that isnt a lodger.


by splitting a property into 2 dwellings, its not the owner that would be paying 2 lots of council tax, tv licence etc, it would be the occupiers


building regs & fire regs:
how do you know youve followed them? have you asked the council to check that the works meet the required regs for 2 dwellings, ie. a house split into 2 flats?
i think the answer to that one will be no

mortgage & insurance:
they are aware of what? that youve got a lodger?
which is incorrect!
are they aware that you are splitting 1 dwelling into 2?
i think the answer to that one will be no
you do realise that youve very likely invalidated your buildings & contents insurance, & youve broken various t&c's on your mortgage?


"the only real dishonest thing..."
apart from not following the laid down rules & regs?
oh, & its not that your failing to declare, you are actually lying about the amount of rental income to HMRC, tax fraud, which is illegal.


"If anyone else has any ideas on how to lower my mortgage in a house I can't sell, feel free"
er, how about the £2500 + architect fees that could have been put towards paying off the mortgage?

edgex

Don74 wrote: »

Lots of people have lodgers in to help raise cash. I have followed all building regs and fire regs, My mortgage company is aware as are my insurance. The only real dishonest thing is not declaring the full amount of rental income. The issue here is what the council classes as an annex and it is this fact I have come to this forum for. All I wanted was to have a lodger and a bit of privacy as well, not much to ask for, but the council want you to pay extra council tax for this. Perhaps you agree with council tax, I always thought it depended on the property value as it was in the 1930s, why should mine change just because I got a lodger in. Perhaps they need the money to put into an offshore account and we are the dishonest ones eh!

I can see that I am getting no-where on this forum as none of you have never done anything wrong in your lives and fully agree with whatever the government deems right. We are getting taxed to death in this country and there are plenty of people who do a lot worse than me in trying to avoid it.

Thanks Planning_Permission for your advice which was helpful, at least I know that applying for planning permission would be very risky as they would indeed inspect the property. So it looks like I'm stuck with being dishonest because the alternative means it wouldn't be worth the process in the first place.

If anyone else has any ideas on how to lower my mortgage in a house I can't sell, feel free.

more stupidity :rotfl:

the council dont give a t*ss if youve got a lodger, it dosnt affect the rateable value of the house at all
& when did they calculate those rateable values? a long long time after the 1930s!

why would the value of a property change if youve got a lodger in?
property values are based on property size/rooms, location & condition
how could the occupants affect that?

Don74

Ok I am a completely breaking the law; but can anyone answer these questions:
If found out, how bad does it get, ie do I pull my works down,do I need to back pay council tax, how far does it go. Can I get away with just removing the upstairs kitchen once found out, if this is the case then it is no longer an annex.
I looked at other council websites before doing any of this and they clearly state that if a lodger has to cross a shared part of the house to use a bedroom etc then it is not regarded as an annex. Is my council right in saying it is an annex, perhaps all of the above is legal. Where are the clearly laid rules stating what an annex is? It seems every council has it's own rules on declaring what an annex is supposed to be.
How is it their own dwelling, they have to use a bedroom in our upstairs area, we also have to cross their area for access to the garden. All of our services are in their area. As far as I'm concerned it is not completely self contained but surely their are clearly laid rules for this?
We are going to do what we are doing, we have to make ends meet, Yes we have spent 2,500 but we can pay off a lot more than that, we have no alternative. We are not hurting anyone or robbing anyone, give us some slack.

Don74

Very good question on the rateable value, why does it need to change just because we have split the house?? Still the same value right. So how does this warrant two seperate council tax no doubt a lot higher than the original value. Does this seem right to you?

Don74

Another question, why should I pay tax on rental income, I pay income tax, my tenant pays income tax, and yet this money is taxed again. Do you have to pay tax on stuff you sell on Ebay or the car boot, why should I pay tax on selling a timeshare on my property?
And what is all the extra council tax for? Am I getting another policeman walk down my road, do I get more books in my library due to my tenant, Do I get more schooling for my tenants and my non existant kids. Do I get more refuse collection than the rest of the council house tenants along my street who have far more people living in their house than should be legally possible.
Like I said I am not doing much wrong. I have followed building regs becasue we have already subjected our plans to the building regs dept and I have followed all recommendations and plans, the last stumbling block was sound proofing between the floors on which the building regs dept suddenly realised that it isn't a single dwelling anymore. Hence my current situation.

edgex

Don74 wrote: »

Very good question on the rateable value, why does it need to change just because we have split the house?? Still the same value right. So how does this warrant two seperate council tax no doubt a lot higher than the original value. Does this seem right to you?

the rateable value on the house dosnt change
it just ends, as the property that had been rated, & the council tax was being paid on, no longer exists

there is then new rateable values calculated for the 2 new properties

& they could well be higher, as a 1 bed flat + a 3 bed flat are likely to be worth more than a 4 bed house
(more rooms, eg. 2 kitchens, 2 bathrooms etc)


that seems perfectly logical, how can it not be?

edgex

Don74 wrote: »

Another question, why should I pay tax on rental income, I pay income tax, my tenant pays income tax, and yet this money is taxed again. Do you have to pay tax on stuff you sell on Ebay or the car boot, why should I pay tax on selling a timeshare on my property?
And what is all the extra council tax for? Am I getting another policeman walk down my road, do I get more books in my library due to my tenant, Do I get more schooling for my tenants and my non existant kids. Do I get more refuse collection than the rest of the council house tenants along my street who have far more people living in their house than should be legally possible.
Like I said I am not doing much wrong. I have followed building regs becasue we have already subjected our plans to the building regs dept and I have followed all recommendations and plans, the last stumbling block was sound proofing between the floors on which the building regs dept suddenly realised that it isn't a single dwelling anymore. Hence my current situation.

again
you havnt got a tenant/lodger
you are trying to create 2 seperate dwellings
(see above reply for what that means in terms of council tax)


if it was a real lodger, ie. they just have a furnished room, & shared all other facilities, HMRC allow you to receive an income from them of £4250 per year tax-free (£81.73 per week)
if you are receiving more than that, you will need to declare it as income, because thats what it is. you would then pay income tax, at whatever rate you currently are, on the rental income above £4250

yes you pay income tax
you also then pay VAT on most goods & services, the providers of which also pay tax

if your operating as a business on ebay, then yes, you will have to pay tax on that income
& yes, HMRC do track whats going on on ebay


again
if you had a real lodger, there wouldnt be any additional council tax



building regs
somewhere along the line you were not entirely clear with them what you were doing, & what you were trying to achieve
i'll have a £1 bet that you didnt at any point inform them that you were trying to create 2 seperate dwellings

as long as what is planned, & what is done, meets the neccesary regs, they dont care what you use the rooms for
that applies to your loft conversion, putting a shower room in downstairs, probably even an upstairs kitchen

as soon as you try to create 2 seperate dwellings in the one building, which is what you are doing, there are then a lot more regs to be met, & planning will get involved

edgex

Don74 wrote: »

Ok I am a completely breaking the law; but can anyone answer these questions:
If found out, how bad does it get, ie do I pull my works down,do I need to back pay council tax, how far does it go. Can I get away with just removing the upstairs kitchen once found out, if this is the case then it is no longer an annex.
I looked at other council websites before doing any of this and they clearly state that if a lodger has to cross a shared part of the house to use a bedroom etc then it is not regarded as an annex. Is my council right in saying it is an annex, perhaps all of the above is legal. Where are the clearly laid rules stating what an annex is? It seems every council has it's own rules on declaring what an annex is supposed to be.
How is it their own dwelling, they have to use a bedroom in our upstairs area, we also have to cross their area for access to the garden. All of our services are in their area. As far as I'm concerned it is not completely self contained but surely their are clearly laid rules for this?
We are going to do what we are doing, we have to make ends meet, Yes we have spent 2,500 but we can pay off a lot more than that, we have no alternative. We are not hurting anyone or robbing anyone, give us some slack.

how bad does it get?
you would have to reinstate the property to how it was before you started any of the works
& they would be keeping a very close eye on you to ensure that thats what you did, & that all the work met all the building regs 100%.
& then your stuck, as they wont allow you to split it into 2 flats
( i really cant see a council allowing it after youve done all that)

council tax, dont know, ask your council :rotfl:

rental income?
HMRC will charge you tax on it, & if they decide that youve committed fraud, may decide to prosecute
if they do, & your found guilty, you then get a criminal record



"I looked at other council websites before doing any of this and they clearly state that if a lodger has to cross a shared part of the house to use a bedroom etc then it is not regarded as an annex"

i dont think you have a clue what is meant by the word 'lodger', or how having a lodger works
usual way:
a lodger has 1 room, a bedroom, & that is all. they actually use the same bathroom, kitchen, living room, dining room, hallway & front door as the main occupants of the house.
to access this bedroom, they therefore have to 'cross' the shared front door, hallway, stairs etc

if they have their own bathroom, kitchen etc, & own access, they are no longer a lodger.