new landlord : Private use adjustment

worto03

Hi - It's my first SA form and I'd appreciate a little help!

when we couldn't sell the house we moved out and rented it.

2012 - 2013 was the beginning of the change from me living there to renting it out so Jan \Feb\Mar were the only months it was rented out for, we lived there for the previous 9 months in that tax year.

Do I complete anything for private use adjustment for the other 9 months in that tax year?

In fact is there anything I need to be aware of around the rest of the year as they have taken my wages from the full year but I've only put details in for the property side of things from when I started to let it out - is that correct?

thanks for any help, I hope I've done something wrong as my calculation has come out at £1500 in tax & we were making a loss each month - although they were obviously contributing to our mortgage.

worto.

nomunnofun

You declare the income received by way of rental in that three months and claim the expenses associated with that rental in that three months. This may include wear and tear allowance - have you researched this deduction?

You can also claim the mortgage INTEREST associated with that three month period, NOT the repayments. It may be problematic to obtain that figure but that is what is required. If you believe that you have made a loss by including the full mortgage repayment you may find this not to be the case.

The tax bill does not look correct - have you included the tax paid at emplyment on the form?

worto03

Thanks for the reply - sounds like I've done those bits right then. I don't think I can claim the wear and tear because I did leave some furniture but officially let it out as unfurnished.

I think it's because I do a sharesave scheme at work and sold 8k worth of shares (only £4500 profit though) which I thought would make no difference because it's below the £10,900 capital gains tax.

wages wise I earn't 40k but was taxed (£6465) on that already - it's just a normal job with PAYE and NI taken at source (I've not been asked about NI anywhere I take it that's irrelevant for a SA?)

These are the details from the property

in total I got paid £1650 in rent but had £2116 in offsets so I'm a bit confused as to why I'm paying any tax on top of what I've already paid via my wages?

incoming rent £1,650.00

landlords insurance -£139.00 rent, rates, insurance, ground rents
mortgage from 4th Jan - 25th Jan -£418.00 loan interest and other fiancial costs
BG cover for boiler march -£16.00 costs of services provided
BG £50 excess march -£50.00 costs of services provided
EA fees -£425.44 legal, management and other professional fees
interest on mortgage -£918.49 loan interest and other financial costs
Gas Cert -£55.00 other allowable expenses
a&l permisson to let -£95.00 other allowable expenses

nomunnofun

You do not even need to declare the share sales.

I suggest that you procedd to the 'view your calculation' page and check that all the income and tax deducted figures are correct. There should be nothing on this page about rental income as you have made a loss.

Have you declared the share sales/ Where have you put them on the form?

worto03

thanks I have a meeting at 10 so I'll be back on in an hour, when I remove the shares from the calculation it changes to £60 tax.

So do I not have to declare the shares because they were below the £10,900?

I thought I would put them on and the form would calculate that they were below so not tax me.

thanks for the help.

nomunnofun

worto03 wrote: »

thanks I have a meeting at 10 so I'll be back on in an hour, when I remove the shares from the calculation it changes to £60 tax.

So do I not have to declare the shares because they were below the £10,900?

I thought I would put them on and the form would calculate that they were below so not tax me.

thanks for the help.

Correct - I thought that was what had occurred as 20% of £8k is close to your previous underpayment figure, and even closer with the new £60 figure (you must have boobed with the capital gains entries!!)

The £60 - have you professional subscriptions or fixed expenses at your job - what is the tax code on your P60?

worto03

That's good news!

My tax code is 810L, maybe it is from the expenses section. I'm starting to think I shouldn't have filled that in either now.

I have to go to London once a month or so with my job and have expenses associated with that - so I spend the money from my bank account and claim it back.

I think I've misunderstood that haven't I and can leave it out.

nomunnofun

More than likely - I presume that you do not earn £40k exactly - as I make the tax at £6379 - £40430 perhaps?

worto03

It's £40432, I didn't really want to put all of this on the internet :-o but you've been a great help and I ran out of options, I should have got an accountant to help I think!

the wording a phrases are quite alien to me compared to what I normally work with!

It seems to think I owe 40p now

Total tax, Class 4 NIC and Student loan due for 2012-13 £0.40

no idea what that's all about but I'm in a much happier place anyway!

Thanks.

nomunnofun

worto03 wrote: »

It's £40432, I didn't really want to put all of this on the internet :-o but you've been a great help and I ran out of options, I should have got an accountant to help I think!

the wording a phrases are quite alien to me compared to what I normally work with!

It seems to think I owe 40p now

Total tax, Class 4 NIC and Student loan due for 2012-13 £0.40

no idea what that's all about but I'm in a much happier place anyway!

Thanks.

Yes -I meant to put £40430 :doh:not £41430. The 40p is down to rounding - glad it's sorted!