Tax on rental income

terryw

theartfullodger wrote: »

- Is this because you are renting it out at below market rent??? If so Tax man may decide to tax you on what they think the rent should be...
Lodger

I have never come across this before. Can you give a link please. Thanks

ellies_angel

theartfullodger wrote: »

Er.. no, Declare full rent income before agent taxes his rake-off, then have agents charges listed as expenses...

Hi
So should I ask my leasing agent to change the format of the monthly statement that they send as the statement I received (this is my first month) just had on it the payment I was receiving from them
Thanks

ellies_angel

theartfullodger wrote: »

Ellie said...


Ellie - if you declared this to taxman you got the numbers wrong... taxable income from rent of £5,010 less mort. interest of £4300 IS £710...

Cheers!

Lodger

Hi Lodger

Ha ha I knew what I meant I just got a wee bit confuddled :rotfl: which is even better cause once I pay my British Gas service agreement, building and content insurance I will almost if not at a loss :T would have actually liked to have made a bit from it, my agent fees are high because they guarentee my rent whether I have a tennant or not

Appreciate you putting me right

theartfullodger

Terryw asked....

I have never come across this before. Can you give a link please. Thanks

It's a general principle that HMRC don't look kindly on people arranging matters so that less tax is due that should ordinarily be the case...
See e.g.
http://www.hmrc.gov.uk/manuals/bimmanual/BIM75705.htm

If you 'phone the tax man & explain you are charging less than market rent for something they may (or may not..) be kind & understanding.///..

But if, for example, they suspect the paperwork says 4-bed flat Mayfair rented for £500/per mo but indications that it is worth a lot more - and, further, suspicions of cash changing hands... to avoid tax... one's tax bil may suddenly increase...

Cheers!

Lodger