Rental income for separated mother-in-law

bradders100

My mother-in-law looks like she is soon to separate from her husband. She lives up north. Her children (my wife and sister-in-law) and grand children live in the south near St Albans. Property where she lives is worth approximately 3-4 times less than it is where we all live. If the separation ends in divorce and her house is sold she may come away with £140k. She wants to move down south to be near us. We've come up with an idea but can't quite work out the viability, tax implications, etc. What if she bought somewhere, slightly further away from us, to let with higher rent yields and capital gains potential but then rented somewhere to live for less that's very near us. Would she still be liable for income tax on the rental income even though it's the only property she owns?

Jenniefour

Yes. The fact that it would be the only property she owns would not make a difference.

00ec25

income is income and gets taxed accordingly

how you spend that income , on for example, the cost of renting the place you actually live in is irrelevant.

Why people still think you can offset income from owning against rent paid if you only own one place is a mystery

G_M

Lots of links to info here:

* New landlords: advice, information & links