Transfering tax responsibility
shoozizzle
Posts: 3 Newbie
in Cutting tax
Hi
We are currently renting out our property and have been over the past few years. We have had a letter today from the let property campaign. Now i will admit to being really daft and not even considering the tax implications on the property (We moved out and into a rented accommodation because we couldnt sell it at the time and this was more financially viable. So we are landlords and tenants at the same time) and yes we are stupid. So no need to reiterate that fact. Fortunately, we dont seem to have accumulated much actual profit over the years. But my question is this...can i do a self assessment form in my name (the house is in both of our names) as i have the lower income. The letter has been sent to my husband who has a higher tax band. This would obviously help us out in the future should our income increase?
Hope this makes sense
Thanks
We are currently renting out our property and have been over the past few years. We have had a letter today from the let property campaign. Now i will admit to being really daft and not even considering the tax implications on the property (We moved out and into a rented accommodation because we couldnt sell it at the time and this was more financially viable. So we are landlords and tenants at the same time) and yes we are stupid. So no need to reiterate that fact. Fortunately, we dont seem to have accumulated much actual profit over the years. But my question is this...can i do a self assessment form in my name (the house is in both of our names) as i have the lower income. The letter has been sent to my husband who has a higher tax band. This would obviously help us out in the future should our income increase?
Hope this makes sense
Thanks
0
Comments
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http://www.hmrc.gov.uk/manuals/pimmanual/pim1030.htm
See Jointly owned property - husband & wife or civil partners
http://www.accountingweb.co.uk/anyanswers/question/allocation-rental-income-husband-and-wife0 -
Hi, thanks very much for the links i'll digest and see if i can make sense of it all, but from glancing it appears that really its a case of rental profit being taxed 50:50?0
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shoozizzle wrote: »Hi, thanks very much for the links i'll digest and see if i can make sense of it all, but from glancing it appears that really its a case of rental profit being taxed 50:50?
- if the property is owned by both people then both are liable for their respective share of the net profit
- if the people are married then the default share is taken to be 50/50
- if a married coupled what to use a share other than 50/50 they must each register a Form 17 declaration with HMRC. The uneven split will then take effect from the date the declaration is received by HMRC as long as you also send in a declaration of trust to support the Form http://search2.hmrc.gov.uk/kb5/hmrc/forms/view.page?record=TS9D3da9t7I&formId=5159
- if unmarried the respective share is different
in summary
no you cannot take all the taxable income. Your husband is liable for 50% of it0 -
Ok so yes, having read the article links and the above i understand that it is a 50:50 liability.
many thanks for your replies.0 -
in a nutshell
- if the property is owned by both people then both are liable for their respective share of the net profit
- if the people are married then the default share is taken to be 50/50
- if a married coupled what to use a share other than 50/50 they must each register a Form 17 declaration with HMRC. The uneven split will then take effect from the date the declaration is received by HMRC as long as you also send in a declaration of trust to support the Form http://search2.hmrc.gov.uk/kb5/hmrc/forms/view.page?record=TS9D3da9t7I&formId=5159
- if unmarried the respective share is different
in summary
no you cannot take all the taxable income. Your husband is liable for 50% of it
Is it not effective from the date of signature (had an issue some years ago with this) or has that also one of the modifications in March (I think) this year?There are 10 types of people in the world - those who understand binary and those who do not. :doh:0 -
purdyoaten wrote: »Is it not effective from the date of signature (had an issue some years ago with this) or has that also one of the modifications in March (I think) this year?0
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I was trying to keep it simple and avoid anyone thinking they could back date the signature to "game" the system
No problem - there were some changes in March - that could well have been one that I missed since my retirementThere are 10 types of people in the world - those who understand binary and those who do not. :doh:0
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