How to declare money from DD

74jax

Keep_pedalling wrote: »

You say we have been declaring it, but you don’t own the property the only person who should be declaring it is you husband. If you want to take advantage of your allowances then he should consider a transfer of ownership.

Sorry yes you are correct my husband has been declaring it.

However as the money will be going into my account I need to declare it and can't declare it as rent as its not my property to rent. However I can put it against Misc Income. So I answered my own question really.

I only said 'we' as I meant me and my husband but you are correct it was in his name.

Not too bothered on allowances, just wondered how people declared something like this. But I found it, should have checked on the tax return first

CRANKY40

Mojisola wrote: »

How can you open an account in someone else's name?

No, I meant go together to open an account ..... daughter will think mum is stashing some pennies in it but mum can quite legitimately put daughter's own money in it.

Mojisola

CRANKY40 wrote: »

No, I meant go together to open an account ..... daughter will think mum is stashing some pennies in it but mum can quite legitimately put daughter's own money in it.

Daughter will get info about the account as well as the mother.

AnotherJoe

74jax wrote: »

Sorry yes you are correct my husband has been declaring it.

However as the money will be going into my account I need to declare it and can't declare it as rent as its not my property to rent. However I can put it against Misc Income. So I answered my own question really.

I only said 'we' as I meant me and my husband but you are correct it was in his name.

Not too bothered on allowances, just wondered how people declared something like this. But I found it, should have checked on the tax return first

If your husband is declaring it, you don't need to,otherwise you'd both be declaring it !
If your husband gave you the money after he received it there's no tax issue there, and there's no difference between DD giving dad the money and dad gives it to you, or DD gives it you you. Same effect.
If your husband doesn't declare it and you declare income, there's a whole raft of HMRC issues potentially heading your way.

74jax

AnotherJoe wrote: »

If your husband is declaring it, you don't need to,otherwise you'd both be declaring it !
If your husband gave you the money after he received it there's no tax issue there, and there's no difference between DD giving dad the money and dad gives it to you, or DD gives it you you. Same effect.
If your husband doesn't declare it and you declare income, there's a whole raft of HMRC issues potentially heading your way.

DD hadn't moved in yet. Husband refuses to take money from her when she does. We have reached an agreement I'll take it but unknown to DD will keep it and give her it back when buys her own place. I can't declare it as rental as I have no where to rent, but can declare it as misc income. Husband will not be declaring anything, only I will. I guess when it comes to filling the form in it will be clearer, I just wondered what others did.

tlc678910

Hi,
Your husband owns the property so he is entitled to the rent money. Either he doesn’t want to charge rent and so none is charged or it is charged and he should declare it and pay tax on it. The fact he has decided to gift it to you makes no difference. You don’t need to declare it as there is no tax on gifts and it is fine to receive regular gifted money from your husband. You are correct you can’t charge rent and be taxed on it on a property you don’t own - your husband should be. Even if it doesn’t hit his bank it should be on his tax return.

It is a very tax inefficient way to help your daughter as presumably your husband has used his tax free allowance and will pay tax on the rental income (and if he is a higher rate tax payer on mortgage interest too). Your daughter could instead open a help to buy ISA etc and benefit from amounts being added to her money. You could ask for proof of x amount of money saved each month in return for charging no rent. If she doesn’t save then rent is charged.

Tlc

AnotherJoe

74jax wrote: »

DD hadn't moved in yet. Husband refuses to take money from her when she does. We have reached an agreement I'll take it but unknown to DD will keep it and give her it back when buys her own place. I can't declare it as rental as I have no where to rent, but can declare it as misc income. Husband will not be declaring anything, only I will. I guess when it comes to filling the form in it will be clearer, I just wondered what others did.

There's a big failing in understanding here.
You can no more claim this is your income, than husband not declare his salary from work and you declare it instead ! That will be treated as fraud if it's detected. The fact DD pays it directly to you doesn't alter things, your husband would not be declaring income. Surely you can see this is not legal and worse it looks like a clear and transparent method to evade tax, especially if your husband is the higher earner and you the lower (or if its the other way around as well as still being illegal, you'd be needlessly paying more tax than you should. ).
In order fo you to claim it you'd have to have an interest in the property for which there is a cost to transfer it on the land registry.
You are also giving up on the interest / tax bump your DD could get by putting it into her LISA and (assuming you don't actually go ahead with this tax fraud) you are on a double whammy losing out since the money DD pays gets taxed. So you start with 100, that gets reduced to either 60 or 80 depending if husband is high rate taxpayer. Or DD puts 100 into LISA and gets 125. She could get Quite possibly double the money if you do this sensibly. I don't know what she's paying in rent but if it was £500/m that would be losing around £4,000-£6,000 over two years.

74jax

AnotherJoe wrote: »

There's a big failing in understanding here.
You can no more claim this is your income, than husband not declare his salary from work and you declare it instead ! That will be treated as fraud if it's detected. The fact DD pays it directly to you doesn't alter things, your husband would not be declaring income. Surely you can see this is not legal and worse it looks like a clear and transparent method to evade tax, especially if your husband is the higher earner and you the lower (or if its the other way around as well as still being illegal, you'd be needlessly paying more tax than you should. ).
In order fo you to claim it you'd have to have an interest in the property for which there is a cost to transfer it on the land registry.
You are also giving up on the interest / tax bump your DD could get by putting it into her LISA and (assuming you don't actually go ahead with this tax fraud) you are on a double whammy losing out since the money DD pays gets taxed. So you start with 100, that gets reduced to either 60 or 80 depending if husband is high rate taxpayer. Or DD puts 100 into LISA and gets 125. She could get Quite possibly double the money if you do this sensibly. I don't know what she's paying in rent but if it was £500/m that would be losing around £4,000-£6,000 over two years.

Thanks for you reply, and to be honest how in depth it was, I don't claim to know this stuff hence asking. If husband would just take the money off her it would be so much easier.

No way is it 500 a month, she'd have nothing left, maybe 50-100 but it would be regular and definately in my bank. I didn't know he would be classed as evading tax by refusing to accept it. I genuinely didn't see it as illegal, just taking money from my daughter and I was going to claim it in my tax return seeing as he wouldn't.

Thank you though and I could sence the frustration in your reply but I guess that's happened to me on here too at times.....

I knew the money exchanging hands had to be declared as it was a different home to the 'family' (unlike a previous poster ..) but couldn't understand how to do it.

I really don't like her living there (for free) and just paying bills. Maybe I do need to look at that, but I don't want her to feel looked after, I feel she should pay her way.... I know that's my issue.

Thank you again though, for so early in the morning I appreciate it.

AnotherJoe

Crikey if it's only £50-£100 a month you are already giving her a massive benefit anyway compared to what she would have to pay for rent anywhere else so it's not exactly a surprise to her you are gifting her, so why not just go the final 5% and say that rather than her pay you a nominal rent you want her to set up a LISA and pay into that instead so she gets the bonus as you can't.

It also bypasses all these tax complications and HMRC will be just as much a PITA over £50 not declared than £500. Don't give them any excuse to cause an issue and start digging into tax affairs because what woudl you say this income was for? If it comes out its for a property you don't own then maybe they would dig in and suggest worse case that actually husband was getting market rent and not declaring it. Why give HMRC the possibility to open that can of worms all because of a secret that actually isn't really a secret? DD knows full well you are giving her a big benefit already.