Employed and self employed joint mortgage

C.w_Wilson

Hi, was looking for advice on the following..

Me and my partner are looking to get our first house, I am in full time employment earning 20k a year. My partner is a self employed mobile stylist, and we have a £10k deposit, now heres the tricky part. Her finances have been “reduced” to minimise tax since she started trading about 4 years ago, so we donthave 2 years accounts available to be scrutinised by the lender. Are we still able to get a joint mortgage or would it be a better idea for it to be in my name only? Is there anyway for her finances to be taken in to account when calculating how much we can borrow? Any help would be greatly appreciated.

ACG

What do you mean by "her finances have been reduced to minimise tax" and "we dont have 2 years accounts available"?

An accountant can only reduce the books with legitimate businesses expenses, anything else is tax evasion and illegal. If they are legitimate business costs then whatever the profit is after those costs is what you can use as income.

Following on from the above, you should be declaring your income even if below the income tax/ni threshold. It should be decalred in a self assessment, if you (or your accountant) has been doing that, you can request an SA302 which will have evidence of declared income and that is the figure which can be used.

Whether or not your partner has been declaring the correct (or any) income, they can still go on the mortgage as a joint applicant. You do not need an income to go on a Mortage if the other applicant is earning enough.

C.w_Wilson

What I mean by that is that her earnings are mostly paid in cash and don’t usually make up to 10k a year which she does declare at the end of the tax year, and we are lead to believe that when getting a mortgage an income lower then 10k generally can’t be taken into account (correct me if I’m wrong?). I can assure you she is doing nothing illegal, she takes advice from a legitimate financial advisor to minimise the amount of tax she pays by claiming tax relief on business goods etc.

Following on from that, would her income increase the amount we can borrow or perhaps reduce it? Are we more likely to have the application rejected if her name is put on it?

Thanks

ACG

You can go on an application with £0 income, less than £10k is not a problem.

I cant answer the second question, that will depend on the details but earning less than £10k is not a reason to be declined.