Tax returns if no rental income

sw_jay

Hi everyone.

I am a bit confused as to whether I need to complete a tax return for a rental property that I have owned since Oct 2012.

I get absolutely no rent from it as I bought the house to allow my mother to live there rent free in later life so I know that I will not need to pay any tax at the moment. However I was wondering if I still need to declare the circumstances to HMRC and complete the return, especially in case I need to offset my losses against any future rental profits.

I want to get it right first time so I don't get stung with any fines for not completing forms on time.

Any advice would be appreciated.

Laurajo_2

You haven't started renting, I would suggest that, unless you have been actively seeking a tenant or getting the house in a better state to rent, the costs wouldn't be allowable anyway.

Has a return been issued? If so, complete it - you will be fined regardless of the requirement to complete it if you don't.

You could always ring or write to hmrc and ask to be taken out of SA, but that will mean that you will only have to reregister again (which is easy enough, to be fair, but if it's likely to have rental income for 2014 you might want to stay in anyway).

sw_jay

Laurajo wrote: »

You haven't started renting, I would suggest that, unless you have been actively seeking a tenant or getting the house in a better state to rent, the costs wouldn't be allowable anyway.

Has a return been issued? If so, complete it - you will be fined regardless of the requirement to complete it if you don't.

You could always ring or write to hmrc and ask to be taken out of SA, but that will mean that you will only have to reregister again (which is easy enough, to be fair, but if it's likely to have rental income for 2014 you might want to stay in anyway).

Sorry, I probably didn't make it very clear.

My mother does already live in the house, albeit rent free so I am incurring the mortgage costs myself.

I was just wondering whether I still need to inform the HMRC even though I don't currently make a profit.

Laurajo_2

No, you don't need to inform hmrc...but you can't claim the costs eithe

kidmugsy

It's not a rental property if you are not receiving rent. There's nothing to declare.

John_Pierpoint

Presumably mum is paying Council Tax at the single occupier rate and you (and your partner?) own the property, without any signs that mum financed the transaction.

CGT relief for a dependent relative disappeared for new cases in the 1980s.

http://www.hmrc.gov.uk/manuals/cgmanual/cg65550+.htm
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