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Income tax on buy to let
Newheight13
Posts: 240 Forumite
Hello,
Any advise on how to deal with the below scenario:
Mortgage 94k and value is 190k and is my only home.
Any advise on how to deal with the below scenario:
Mortgage 94k and value is 190k and is my only home.
Wife earns 47k
Myself 16k
We want to purchase a property and let out this one which we know from other properties in the same block have rented within days for 1000PCM.
My understanding is my wife would pay 40% tax on most of her share so could I transfer this into my name because of the lower tax bracket?
We paid 165k for the property a year ago, would anyone else be tempted to sell?
Myself 16k
We want to purchase a property and let out this one which we know from other properties in the same block have rented within days for 1000PCM.
My understanding is my wife would pay 40% tax on most of her share so could I transfer this into my name because of the lower tax bracket?
We paid 165k for the property a year ago, would anyone else be tempted to sell?
Thanks
0
Comments
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You might end up selling for 185k, pay CGT on the 20k profit and have 2x solicitor and other transactions costs incl sdlt.
there will be hardly any profit left, esp not after factoring in time.
would defo not be tempted to sell for financial reasons, other reasons might depend on why you want to move already after 12 months?
cant advise on taxes, probably tax advisor best positioned.0 -
A married couple can shift beneficial ownership between themselves without adverse tax implications. But, your lender may not agree.Are you going to get a BTL mortgage or consent to let?No reliance should be placed on the above! Absolutely none, do you hear?1
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@newheight13 The taxman allows spouses to distribute the rental income as per 'beneficial interest' in the property, for example 99%-1%.Newheight13 said:Hello,
Any advise on how to deal with the below scenario:
Mortgage 94k and value is 190k and is my only home.Wife earns 47k
Myself 16k
We want to purchase a property and let out this one which we know from other properties in the same block have rented within days for 1000PCM.
My understanding is my wife would pay 40% tax on most of her share so could I transfer this into my name because of the lower tax bracket?
We paid 165k for the property a year ago, would anyone else be tempted to sell?Thanks
https://www.gov.uk/government/publications/income-tax-declaration-of-beneficial-interests-in-joint-property-and-income-17
The process needed to make this happen will differ based on how the property is owned now (joint tenants, tenants in common, your sole name, etc.)I am a Mortgage Adviser - You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
PLEASE DO NOT SEND PMs asking for one-to-one-advice, or representation.
2 -
There shouldn't be any CGT as it sounds like the poster's home that they currently live in?Schwarzwald said:You might end up selling for 185k, pay CGT on the 20k profit and have 2x solicitor and other transactions costs incl sdlt.
there will be hardly any profit left, esp not after factoring in time.
would defo not be tempted to sell for financial reasons, other reasons might depend on why you want to move already after 12 months?
cant advise on taxes, probably tax advisor best positioned.I am a Mortgage Adviser - You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
PLEASE DO NOT SEND PMs asking for one-to-one-advice, or representation.
4 -
Have you considered that keeping this property would mean you pay higher rate stamp duty on your new property?0
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Thank you for all the replies.We live in the property and it’s our 1st and only property.
Reason for move is we have a baby on the way and there is no lift and top floor so it’s not practical.0 -
Most people would just sell, and buy elsewhere.Newheight13 said:Thank you for all the replies.We live in the property and it’s our 1st and only property.
Reason for move is we have a baby on the way and there is no lift and top floor so it’s not practical.It’s a personal choice whether you move, or just get very very fit carrying baby up the stairs.
No reliance should be placed on the above! Absolutely none, do you hear?0 -
Do you really want to take on the responsibilities of being a landlord at the same time as taking on the responsibilities of being new parents?1
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