House letting and registering for self assessment

mikey9863

My wife and I are going travelling and we have a tenant for the house while we are away. I rang HMRC and asked about need to self assess. one guy said we did as the rent is over £2500 and another said we didn't if any income after deductions was less than £2500.....
Anyone any ideas to what we need to do.....


PS Income after deductions is well under £2500.

Thanks in advance

pyueck

mikey9863 wrote: »

My wife and I are going travelling and we have a tenant for the house while we are away. I rang HMRC and asked about need to self assess. one guy said we did as the rent is over £2500 and another said we didn't if any income after deductions was less than £2500.....
Anyone any ideas to what we need to do.....


PS Income after deductions is well under £2500.

Thanks in advance

https://www.gov.uk/check-if-you-need-a-tax-return

You haven't provided enough info to give you an answer, so suggest you do the check yourself.

Pixie5740

We need more information. What are you including in your deductions? Remember that only the interest portion of any mortgage payment is tax deductible.

mikey9863

We are letting it out for £6240 including the Council tax.

After deducting mortgage interest, council tax and other sundries for the upkeep and running of the property we will be left with approx £1980. I have checked with the allowance through the HMRC and have taken it all into consideration. if I take the second guys advice about not registering because it is under £2500 fair enough but I would be worried that I need to self assess anyway just in case I got the wrong end of the stick. I was going to ask an accountant but they wanted £75 for the pleasure of an answer.

pyueck

mikey9863 wrote: »

We are letting it out for £6240 including the Council tax.

After deducting mortgage interest, council tax and other sundries for the upkeep and running of the property we will be left with approx £1980. I have checked with the allowance through the HMRC and have taken it all into consideration. if I take the second guys advice about not registering because it is under £2500 fair enough but I would be worried that I need to self assess anyway just in case I got the wrong end of the stick. I was going to ask an accountant but they wanted £75 for the pleasure of an answer.

Are you paying the council tax, it's only deductible if you are? What is included in 'sundries'.

mikey9863

I am paying the council tax and the sundries include a gardener/Handyman to maintain the property, he is on a fixed weekly rate and will be around once a week. Plus we are allowing an amount for replacing and damaged fixtures through normal maintenance. We also have professional fees from a solicitor for the tenancy and a fee from a surveyor for documenting the state of the property before we hand it over to the tenant. Insurances are also included in the costings of the Property. All in all I think we have everything covered from an expense point of view.

mikey9863

pyueck wrote: »

https://www.gov.uk/check-if-you-need-a-tax-return

You haven't provided enough info to give you an answer, so suggest you do the check yourself.

Thanks for the link.

Turns out I don't need to register....thats if the calculator is correct.


Maybe I should tell HMRC anyway:think:

Pixie5740

Are you going to be using a letting agency whilst you're away? If not, what address for the serving of notices are you going to give your tenant?

Have you seen this useful guide for NEW LANDLORDS: Advice & Information for New Landlords.

You might find something in it that you've missed. Better to spot it now than try and sort it out whilst you're travelling.

pyueck

mikey9863 wrote: »

I am paying the council tax and the sundries include a gardener/Handyman to maintain the property, he is on a fixed weekly rate and will be around once a week. Plus we are allowing an amount for replacing and damaged fixtures through normal maintenance. We also have professional fees from a solicitor for the tenancy and a fee from a surveyor for documenting the state of the property before we hand it over to the tenant. Insurances are also included in the costings of the Property. All in all I think we have everything covered from an expense point of view.

You can't claim for the surveyor that is a capital expense, you can only claim for the inventory.

Are you sure the solicitor fees relates to the tenancy and not the purchase of the property?

Is the property furnished, you can only claim 10% of the net rent for this.

mikey9863

The solicitor fee is for the tenancy agreement. it is an unfurnished property.

I have just spoke to HMRC again. Twice.in the first call they say I have to self assess even if I don't make a profitand the other says i only have to if I am making a profit of £2500 or more.....Head scratching time.....

jjlandlord

See: https://www.gov.uk/renting-out-a-property/paying-tax

If you called them as explained on that page and they told you to fill in a self-assessment form then just do it.
Or, do pay for professional advice to get directions on how to proceed further.