Please help, massive council tax arrears! SCOTLAND

ILW

googler wrote: »

As someone who has always had a DD set up to merely pay the full amount and be done with it, and with, as far as I know, friends and relatives who do the same, I'm genuinely gobsmacked at this

If the second house/flat isn't making any money for you or your sister, why haven't you, she, OR HER ACCOUNTANT made moves to sell it before now? If it's not making money it's just a millstone around your necks.

What's her situation, that she has an accountant and you don't?

Sounds like sister may be setting up OP to carry the can.

pinklipy

the annual rental income has to exceed £10,000 and provide a profit of £2500 or above. Direct.gov says you need to fill out a tax return if you make more than £2500 profit. We make next to nothing. After I have sorted out the council tax mess I will speak to someone in the know and inform hmrc if needed.

k66yla

Wish I lived in Scotland.......don't have to worry about CT for years, prescriptions and University fees

ILW

pinklipy wrote: »

the annual rental income has to exceed £10,000 and provide a profit of £2500 or above. Direct.gov says you need to fill out a tax return if you make more than £2500 profit. We make next to nothing. After I have sorted out the council tax mess I will speak to someone in the know and inform hmrc if needed.

Think you may be getting cofused with the rent a room scheme. Property rental run as a business must be declared. There may be no tax liability or there may be.
You really need to get this sorted, or you risk losing both houses.

pinklipy

Honestly im not getting mixed up with the rent a room scheme, and if your correct then my mistake (yet another one).
Sister has few buissnes's so there for has an accounted.
The property is inherited so although remortgaged still has a bit of equity in it, even tho it is not making ££ at the moment it isn't loosing either. It is in a great area so rental income will go up.
Hmrc would have contacted us by now if we were doing something wrong would they not? Also surely we won't be in that much trouble as it is easy to see why we wouldn't think you'd have to declare and it has never made us any profit anyway so not like we'r doing hmrc out of ££.

mildred1978

pinklipy wrote: »

Honestly im not getting mixed up with the rent a room scheme, and if your correct then my mistake (yet another one).
Sister has few buissnes's so there for has an accounted.
The property is inherited so although remortgaged still has a bit of equity in it, even tho it is not making ££ at the moment it isn't loosing either. It is in a great area so rental income will go up.
Hmrc would have contacted us by now if we were doing something wrong would they not? Also surely we won't be in that much trouble as it is easy to see why we wouldn't think you'd have to declare and it has never made us any profit anyway so not like we'r doing hmrc out of ££.

So so so so wrong.

ILW

pinklipy wrote: »

Honestly im not getting mixed up with the rent a room scheme, and if your correct then my mistake (yet another one).
Sister has few buissnes's so there for has an accounted.
The property is inherited so although remortgaged still has a bit of equity in it, even tho it is not making ££ at the moment it isn't loosing either. It is in a great area so rental income will go up.
Hmrc would have contacted us by now if we were doing something wrong would they not? Also surely we won't be in that much trouble as it is easy to see why we wouldn't think you'd have to declare and it has never made us any profit anyway so not like we'r doing hmrc out of ££.

Are you keeping full accounts for the property, if not you will not know if you are making a loss or a profit.

It is your responsibility to inform HMRC if you are running a rental business, and failure to do so is an offence.

When they find out they will come down on you like a ton of bricks.

mildred1978

Is the mortgage a buy to let mortgage?

pinklipy

Yes it is a buy to let mortgage and not been keeping an account as it is basic, rent in, mortgage & rates out that's that. Ok well looks as if I'm in humongous trouble but you could be nice to me rather than nasty it's not as if it's you that hmrc. Also I am young (ish) most of my friends still live it home, never mind having 2 mortgages and now tax returns etc. What is likely to happen if I call them and let them know now about the property? Do they also make you bankrupt or send you to jail web tho i won't owe anything? Advice rather than a row would be nice.
Going to my sisters now so will see what is going on regarding her accountant.

HappyMJ

pinklipy wrote: »

Yes it is a buy to let mortgage and not been keeping an account as it is basic, rent in, mortgage & rates out that's that. Ok well looks as if I'm in humongous trouble but you could be nice to me rather than nasty it's not as if it's you that hmrc. Also I am young (ish) most of my friends still live it home, never mind having 2 mortgages and now tax returns etc. What is likely to happen if I call them and let them know now about the property? Do they also make you bankrupt or send you to jail web tho i won't owe anything? Advice rather than a row would be nice.
Going to my sisters now so will see what is going on regarding her accountant.

pinklipy you really must put users on ignore and stop replying. A buy to let mortgage is not essential to have a rental property but anyway that has nothing to do with your original query. Answering your question though...they'll just give you a penalty if any tax has gone unpaid. You have said you declared it to the accountant and don't need to pay any further tax then no penalty is due. Don't worry about it.