Renting a house to family while overseas

theartfullodger

Insurance will likely be a problem given that you will be completely honest about the arrangements.

Speak to a couple of buy-2-lett insurance brokers.

In the opinion of many landlords renting to friends or family, especially for no £££, is a very very quick way to ruin any relationships. I have 3 sons each with partner & kids, I'd not do it. By all means support them when renting from someone else..

Done ANY training or education in being a landlord ?? (You will effectively be landlord)?? If not don't start until you have . (A k=bit like starting to drive a tank without any training….)

WIAWSNB

Hi Splinters.

If your daughter and sil sold their house and moved in with you semi-perm, what changes would need to be made? Who would you need to inform? I would suggest a slight mod to the insurance policy to change the 'number of adults' from 2 to 4, and to add them to the electoral roll/Local Authority.

The first is unlikely to make any difference to the actual premium, but will incur a £25 or so admin charge, and the ElecRoll won't make any difference at all, tho' best you change your voting rights to 'postal' or 'proxy' assuming you appreciate your political suffrage.

For simplicity, keep everything else as it is - utilities, broadband, insurance, CT, whatevs - keep them coming from your account, in your name. D&SIL pay you a monthly sum to cover all this. If they want to change anything like BB or utilities, they can, but any changes to important stuff - insurance etc - you would agree and do this remotely from your new location.

Nice. Sorted. Now go away.

I assume that any time you return for a wee holiday to our wonderful country, you'll stay in yer ol' hoosie?

Whether that is in the spirit of these arrangements - insurance, CT, whatevs - I don't know. But legally, I see no issue. But that is an assumption of mine…

splinters

https://forums.moneysavingexpert.com/discussion/comment/81986775#Comment_81986775

Thanks for all the great advice and as for going away, I have been living here in Zurich for 9 months already ;-) Just to be clear on the numbers in the house, my wife is moving to join me in the apartment in Zurich, they are moving in to our house this July so there will only be two people in there. They will have around £80k+ profit from their house sale (and free of their mortgage) to add to the increased deposit they can save over the next few years as they are not paying rent. They really don't want to be in our house so will move on as soon as they can (expected one to two years). In essence they did this when we live in Thailand for three years - looking after our house rather than leave it vacant. The only difference is they will now be married.I have zero concerns about these guys causing complications, we trust them totally.

BikingBud

Does any money need to change hands? Legally or is just a recognition of the benefit they gain?

Mortgage free? So nobody cares there.

Utilities will not care who pays - see second homes

Council tax will not care who pays - Getting full rate commensurate with occupation level.

Insurance company will likely have no vacant spells clause but are close family classed as long term guests? Many kids that come home after Uni likely do not get added. Where/when does it change?

Is there a CGT liability as not primary residence, likely but wouldn't that be the case anyway?

If you are flush and pay all the bills it will allow them to build their deposit quicker, perhaps it also legitimately distributes some of your estate early.

splinters

https://forums.moneysavingexpert.com/discussion/comment/81989349#Comment_81989349

You have ticked most of the details there. No money changing hands, no mortgage, no debt and they will pay us a few hundred each month to cover the existing Direct Debits for bills etc. The deal was, they can have the house for a year or two as long as it costs us nothing. I just wondered if not being on the council tax/utilities etc. might complicate their next mortgage application when they leave.

As for flush, we are doing OK, but so are they; the son in law alone earns as much as I did in the UK so they are still getting a good deal with just a few hundred to pay each month which is about half of their existing mortgage alone!!

My daughter will be the sole heir to any future inheritance.

WIAWSNB

https://forums.moneysavingexpert.com/discussion/comment/81989796#Comment_81989796

I don't see any reason to not add them to the electoral roll at your address, and for Council Tax. That'll be a useful paper trail for where they have been living when they move on.

Utility bills are not so much of an issue, I don't think, as their absence from the title - should they be asked for proof of ID or whatevs - can be explained by them 'staying with my parents'.

As I said, purely for simplicity's sakes, it strikes me as easiest to consider this as these two living with you under your roof, and it just happens that you won't be there for most of the time. Obviously, technically, it isn't quite correct, but I don't see any conflict anywhere, or tricky issues. No service or utility is being deprived - it'll be full CT and everything else - you ain't diddling anyone, just keeping things simple.

Yes, you have another home abroad where you will spend most of your time, but on any return to Blighty, you will presumably stay at your original home?

That's my understanding - you need to be happy with it.

splinters

https://forums.moneysavingexpert.com/discussion/comment/81989955#Comment_81989955

Yes, you have nailed it there. Another reason we didnt sell outright (as well as not being prepared to vacate and list it right now) is in case things dont work out here for either of us; we would still have a home to go back to.

Also, I realise its a tad 'misleading', but with our names on the electoral register, utilities etc. would that make it easier to sell the house without CGT in the next few years? I mean, who can actually say how long we spend there each year. We are teachers and get around 14 weeks holiday a year so potentially 98m days in the UK….just curious, honest ;-)

silvercar

I would imagine you would sail under the hmrc window. Theoretically your passport records could tell hmrc that you were away for X days, but I don’t think there is a specific number of days you need to be in the house for it to be your PPR. It is another reason to remain on the voting and council registration.

If you had a home in Zurich, that you sold before you sold the UK one, and tried to claim some PPR on the Zurich home, that may raise a flag when you come to sell the UK home, otherwise I think it could be considered your PPR and you are merely working away and coming home when you can. The fact that you have family living in it rent free adds weight to the fact it is your PPR.

WIAWSNB

https://forums.moneysavingexpert.com/discussion/comment/81991639#Comment_81991639

Sorry, I have no idea about CGT liability.

I suspect it would be a bit 'not in spirit' to 'quite dodgy', but most likely either under-the-radar, or overcomeable by your Zurich home being the second or holiday home, especially if you are effectively trialling this move on a shortish-term basis.

But, I emphasise - I do not know.

user1977

I like to think that the money-saving advice here doesn't stretch to "how to do tax evasion".