BTL declaration

Jaguar_Skills

Hi all,

Bit of advice please. I have just purchased 50% of my Gf's BTL flat and therefore this I believe will need to be declared in relation to any tax I pay.

I am currently a HRT payer (PAYE) and when I spoke to HMRC they said that if you can show you won't earn over a certain amount per year there would be no tax implications.

I actually think that there will be a net loss on this ie we do not make much by way of rent as this is only around £30 - £50 higher than the mortgage repayments. I also understand that we can factor in any upkeep and management charges and ground rent as this is a leasehold flat?

Is this correct in that I won't need to pay additional tax?

Also I was under the assumption that I would need to fill in a self assessment tax form but when I spoke to HMRC they said they would just need the projected figures.

Can anyone confirm? Tax really does confuse me....!!!

marliepanda

'Mortgage payment'

Is this a repayment mortgage or an interest only mortgage? If it's repayment you can only deduct the interest

Jaguar_Skills

Yes repayment.

Jaguar_Skills

How do you predict upkeep costs?

marliepanda

Jaguar_Skills wrote: »

Yes repayment.

So you will need to declare the repayment part of the mortgage payment as income from rent, so you may be making taxable profit.

Bluebirdman_of_Alcathays

As above, only a certain amount of your mortgage costs can be deducted from income (the interest component) - you will almost certainly have a taxable profit to declare.


Who handles your GF's tax affairs? An accountant? They will be able to advise as they will surely know the specifics for the last few years.

Thrugelmir

Jaguar_Skills wrote: »

I actually think that there will be a net loss on this ie we do not make much by way of rent as this is only around £30 - £50 higher than the mortgage repayments. I also understand that we can factor in any upkeep and management charges and ground rent as this is a leasehold flat?

Spend an hour with an accountant and get acquainted with both the tax rules and the records you need to keep. May save you a lot of time and bother in the future.

csgohan4

Are eviction/court costs tax deductible?

Thrugelmir

csgohan4 wrote: »

Are eviction/court costs tax deductible?

Yes. Business Expense.

tlc678910

Hi,
I agree that the repayment part of your mortgage is not deductable as an expense.

Also the rules are changing on the deduction of mortgage interest and higher rate tax payers will only get tax relief at the basic rate (sorry don't have a detailed knowledge of this).
Tlc