Permission to let has lapsed!

lovinituk

mcauley wrote: »

Yes it's through agency so all checks are carried out, deposit secure etc

Its good that side is covered.

The potential tax evasion is a serious issue though. Its not going to help your situation any if HMRC get wind and start fining you for back dated tax. It can bite you in the a$$ many years down the line.

silvercar

Sadly I don't think there is an easy way out of this in the short term.

1. Can't sell because there is no way of paying back the negative equity
2. Can't move to a BTL mortgage with another lender because of no deposit/ negative equity

in the long term house price inflation will mean you can sell. In the short term it is a question of finding a way forward that is least painful

silvercar

lovinituk wrote: »

Its good that side is covered.

The potential tax evasion is a serious issue though. Its not going to help your situation any if HMRC get wind and start fining you for back dated tax. It can bite you in the a$$ many years down the line.

Chances are there is no tax to pay= no penalty.

Rushing off now, i'll explain why later.

ANDRUAFER

Thanks both. I've not earned any money in the last two years so don't feel too worried about the tax side of things.

Perhaps I can persuade the lender to let me have the 1.5% raise in interest instead of 3%- who knows!

lovinituk

silvercar wrote: »

Chances are there is no tax to pay= no penalty.

Rushing off now, i'll explain why later.

Yes, I appreciate that, but as we don't know the OPs total income, or how much of the mortgage repayment is interest, I have highlighted potential issues that should be considered.

The OP should be declaring the rental income, even if it equates to a loss anyway.

Annie1960

mcauley wrote: »

I'm ok with not necessarily ending up with a happy result. Disappointing however to face such nastiness in a place that's supposed to be here for advice and support.

Hang on a minute.

People here are giving you good advice. The problem is, you don't want to hear it.

You want people to tell you it's OK to lie to your mortgage provider. Nobody is going to tell you that.

The best way forward for you is to tell the truth to your mortgage provider and to HMRC.

It's up to you if you choose to ignore that. You stand to have to pay HMRC penalty payments and interest on any tax you have not paid that they believe you should have paid. You might even get a tax rebate if you really have made a loss.

Have you checked that your house insurance is valid as you have not got the correct type of mortgage for letting your property?

People really are trying to help you!

Nobody is going to support your plan to lie to your mortgage provider, so if you plan to do that it's up to you, don't expect anyone to encourage you to do this.

Your choice, you're an adult.

ANDRUAFER

So if they only offset the interest paid - is paying the mortgage considered an expense?

Annie1960

silvercar wrote: »

Chances are there is no tax to pay= no penalty.

Rushing off now, i'll explain why later.

They can charge a penalty for not filing, even if no tax is due.

lovinituk

mcauley wrote: »

So if they only offset the interest paid - is paying the mortgage considered an expense?

Only the interest part of the mortgage repayment is considered an expense.

Annie1960

mcauley wrote: »

Thanks both. I've not earned any money in the last two years so don't feel too worried about the tax side of things.

This is irrelevant. If you are letting a property you need to declare the rental income to HMRC by filing a tax return, even if no tax is due. This is true for any business. There is no exemption because you consider yourself to be an 'accidental landlord'.