How much tax on a rented property

alove

I have started renting out my parents old house as a second income. I believe that I need to disclose this to the tax man as a second income. Does anyone know how much I have to pay roughly?

booksurr

alove wrote: »

I have started renting out my parents old house as a second income. I believe that I need to disclose this to the tax man as a second income.

yes you do

if the rental income is more than £10,000 pa or your profit after cost is more than £2,500 you must register for self assessment tax returns

if neither of those apply you must phone HMRC and they will decide how to treat you

alove wrote: »

Does anyone know how much I have to pay roughly?

Do you seriously expect anyone to be able answer that question? How about £26.52 per year based on my guess of what the rent is, what your costs are, and that you may still be a basic rate taxpayer.

read the following, then do please come back and ask about things you don't understand as we will happily explain non comprehension, rather than asking for facts you can look up yourself

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

https://www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

http://www.which.co.uk/money/tax/guides/tax-on-property-and-rental-income/how-rental-income-is-taxed/

sam2015_2

booksurr wrote: »

yes you do

if the rental income is more than £10,000 pa or your profit after cost is more than £2,500 you must register for self assessment tax returns

if neither of those apply you must phone HMRC and they will decide how to treat you
£26.52 and a half pence very year for the rest of your life, oh, I forgot + interest

read the following, then do please come back and ask about things you don't understand as we will happily explain non comprehension, rather than asking for facts you can look up yourself

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

https://www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

http://www.which.co.uk/money/tax/guides/tax-on-property-and-rental-income/how-rental-income-is-taxed/

Very useful. Thanks.
when should I let the HMRC know? AT the end of the year when doing the tax return or now?
Property is in my name but rent goes into my partner's account. who pays the tax? I rather my partner as she is lowest earner of the two.

Pixie5740

sam2015 wrote: »

Very useful. Thanks.
when should I let the HMRC know? AT the end of the year when doing the tax return or now?
Property is in my name but rent goes into my partner's account. who pays the tax? I rather my partner as she is lowest earner of the two.

I'm sure you would but as the property is in your name it's your taxable income. Are you married?

And did you just sign in using the wrong account

elverson

You need to register with HMRC now - the current tax year runs from 6 April 2016 to 5 April 2017.

The tax return then needs to be submitted by the end of January 2018 at which point you pay any outstanding tax or receive a refund of outstanding tax (you can also make payments to HMRC before then if you want to).

sam2015_2

Pixie5740 wrote: »

I'm sure you would but as the property is in your name it's your taxable income. Are you married?

And did you just sign in using the wrong account

Partner collect the rent so it goes into her account and keep it in saving or transfer it to me when ever. Is that not allowed?

Not married yet but will be soon. Is it different for married couple?

Pixie5740

The rent can be paid anywhere but it's YOUR taxable income.

booksurr

sam2015 wrote: »

Partner collect the rent so it goes into her account and keep it in saving or transfer it to me when ever. Is that not allowed?

Not married yet but will be soon. Is it different for married couple?

the property is in YOUR name, so married or not, it is YOUR tax liability. That means, for the avoidance of any doubt, you pay 100% of the tax liability on 100% of your rental profit

tell HMRC now since you very obviously have not done any research at all on what you need to do and therefore the last thing you want is to have to rush things through at the end of the year and then find out you have been doing it all wrong but it's too late to prevent the penalties

done any reading yet?
http://lmgtfy.com/?q=tax+on+rental+income

G_M

sam2015 wrote: »

Partner collect the rent so it goes into her account and keep it in saving or transfer it to me when ever. Is that not allowed?

By that theory, if you employed a letting agent and the rent was paid to them, you could also avoid paying tax.

Sorry! You are the landlord. It's your property, your tenant, and your income.

Makes no difference who collects the rent, what it is spent on, or in whose name it is saved/invested.

Of course, you could transfer the Title of the property into joint names so that your partner co-owned. And became joint landlord.

booksurr

G_M wrote: »

Of course, you could transfer the Title of the property into joint names so that your partner co-owned. And became joint landlord.

and trigger having to pay Capital Gains Tax whilst you are at it - depending on the values !

G_M

booksurr wrote: »

and trigger having to pay Capital Gains Tax whilst you are at it - depending on the values !

CGT will be payable at some stage, so that might be a good thing. If the gain is currently within (or just above) the annual allowance, it would re-set the baseline amount, so when the property comes to be eventually sold the gain at that time might be less.