Dependent Parent Housing Benefit

princessdon

Housing_Benefit_Officer wrote: »

And does the planning permission allow the annexe to be rented out commercially.

I assumed so, OP stated previous owners had a commercial agreement, can't see how this can mean HB anyway as if OP had CT x 2 they'd have rented earlier or not need money (from their posts I assume this isn't the case).

Jools12

I will check planning permission. Because previous owners rented out I have assumed so but need to check. Thanks

princessdon

Jools12 wrote: »

I will check planning permission. Because previous owners rented out I have assumed so but need to check. Thanks

Problem isn't just PP. did you take a deposit, did you inform HMRC of self employment etc, you have a lot to consider, you need to now become a landlord with bells and whistles, at the same time, proving you treat this tenant (your mum), no different from joe blogs.

zzzLazyDaisy

OP if you are renting the annexe out as a commercial tenancy with an AST please be aware that the rent is taxable as an investment under 'other income'.

http://www.hmrc.gov.uk/incometax/non-paye-income.htm

Also as the annexe therefore does not form part of your principal private residence, since it is an investment property, you may be liable for CGT when you sell it. You really should get some financial advice.

princessdon

zzzLazyDaisy wrote: »

OP if you are renting the annexe out as a commercial tenancy with an AST please be aware that the rent is taxable as an investment under 'other income'.

http://www.hmrc.gov.uk/incometax/non-paye-income.htm

Also as the annexe therefore does not form part of your principal private residence, since it is an investment property, you may be liable for CGT when you sell it. You really should get some financial advice.

Yep lots to consider - plus proof they treat the same. I assume they took references, deposited their deposit and first months rent etc.

It's not as simple as OP thought (not impossible) but not straightforward.

Mojisola

Jools12 wrote: »

My mum lives in a self contained annexe on the side of our property.

Alternatively am I entitled to claim any tax relief for having a dependent relative living with me ?

Jools12 wrote: »

Yes she does - we have a rent agreement in place

How can someone who pays you rent be a dependent relative?

Housing_Benefit_Officer

We get planning control to take enforcement action against people renting out their annexes to their relatives as our local authority usually sticks certain conditions in the planning permission. Amazing how quick the housing benefit claim gets withdrawn.

Errata

princessdon wrote: »

Problem isn't just PP. did you take a deposit, did you inform HMRC of self employment etc, you have a lot to consider, you need to now become a landlord with bells and whistles, at the same time, proving you treat this tenant (your mum), no different from joe blogs.

Additionally, if the annexe is a rentable property the OP will have been paying CT on it whilst it's been empty, won't they?