self assessment help- property income

scouseblondie

Hi all , im new to this site and need a little help regarding my self assessment which is due in online. I am self - employed but also I do currently rent a property out, as to which i make a loss on every month (550 mortgage but only get 500 rent) I thort i wouldnt have to pay any tax on my rental income as i dont make any profit but i have since been told by someone that i do because the only expenses i can claim is the interest on the mortgage and any repairs etc. the interest on the mortgage is 235 and the repayment of it each month is 315. Does this sound about right :

rental income : 6000 (12x500)

expenses: 2820 (12x235) plus any repairs etc

taxable property income : 3180 ? ?

Rolo_Tomasi

The principle is sound. I would have thought the interest would be more but it depends on the interest rate. You need to ensure you claim all of your property expenses such as agent fees, gas/electric checks, advertising, legal fees etc. Also if the property is let furnished you can also claim the wear and tear allowance. Finally remember that any profits this year can be reduced by previous years losses.

Murdina

How long have you been renting out? If it was before April 2008 then you need to check that you do not also owe tax for 2008 and earlier - and advise HMRC asap if you do - maybe you made the same mistake then that (in effect) you assumed you could take repayments of mortgage capital off the rent for tax (and as pointed out above, you cannot).

scouseblondie

Murdina wrote: »

How long have you been renting out? If it was before April 2008 then you need to check that you do not also owe tax for 2008 and earlier - and advise HMRC asap if you do - maybe you made the same mistake then that (in effect) you assumed you could take repayments of mortgage capital off the rent for tax (and as pointed out above, you cannot).

thanks for that. started renting in jan 09 so does this mean for tax year apr 08-apr 09 for which im doing my self-assessment now that i only have to put down the rent for jan 09- april 09 or do i do it to date ?

Rolo_Tomasi

You should include property income from Jan 09 to 5 April 09.