Tax on Rental income which year April payment?

UKSBD

I'm about to start renting out a property and have to set the payment date.


Assuming £1000 a month to simplify things.


If I set payment date as 1st of Month starting from September It means I will receive £8,000 in tax year 2015 - 2016


If I set payment date of 7th of month I will only receive £7,000 in tax year 2015 - 2016


Is that how it works, and if so, does it make more sense to have the payment date as 7th of each month?

Innys1

By delaying the due date to the 7th, all you delay is paying tax on £1,000 by one year. You will still eventually have to pay it, you just delay it.

More importantly, how does receiving rent on the 7th every month impact your cashflow position as long as you hold the property?

gfplux

If your tenant moves in on the first are you giving them one week rent free?

ognum

I have found though my accountant that HMRC have a practical way of examining things.

I have had one tenancy that started on April 1st and delayed declaration of it until the following tax year.

You can confirm this or you can self certify the week of rent payment but then you would also need to pro rate and expences you claim against tax as well so it certainly was easier to simply pay the following year.