Rental income & maternity allowance

Bibbitybob

Morning all,

Been awake since 5am trying to work this one out...apologies if I haven't posted on the right board (also posted on rentals board).

My only self-employed income at the moment is the profit from two rental properties, and I am due to have a baby in March next year. Does anyone know if rental income counts as self employed income when maternity allowance is being calculated? It's all declared annually through my tax return.

Thanks in advance.

pmlindyloo

blondebubbles wrote: »

Isn't rental income property income on the tax return rather than self employment? Have you been paying Class 2 NIC?

https://www.gov.uk/maternity-allowance/eligibility

I think this is the part (bolded) that you should ask yourself.

Have you registered as self employed?

Receiving rental income is a bit of a grey area as regards self employment.

From my reading I understand that usually you are classed as a property investor and the income is classed as investment income and you are not self employed.

If, however, you are a property trader then you are self employed.

I take property trader to mean that this is like your job and you are very much involved, for example,doing up houses, and then renting them out - really making a business out of it.

As I said, it is rather a grey area even according to HMRC so I would focus on whether you have paid the class 2 NI insurance contributions necessary in order to claim Maternity Allowance.

Housing_Benefit_Officer

Are you registered as self-employed with HM Revenue and Customs (HMRC) and are you paying Class 2 National Insurance contributions? When you submit Self Assessment tax returns every year do you declare your rental income as self employed income or income from rent?

Bibbitybob

Thanks for everyone's replies. I probably should have specified a bit more detail.

I am registered as self employed with HM Revenue & Customs, I complete a tax return annually but my income from the houses is declared as income from rent (probably where I have gone wrong in this instance).

I do pay Class 2 NICs and have done voluntarily for many years, on the understanding that one day I may need maternity leave.