Income Tax - Sorry might be a stupid question
Options
FrankRizzo
Posts: 223 Forumite
Can anyone help?
I am currently a Basic Rate 20% tax payer (up to £43k) and I am looking to rent out my flat. Going by the . gov website it will put me above my income threshold and would make me a Higher Rate 40% tax payer (£43k+) i.e £35k salary and £8.5k income from my flat = £43.5k total annual income. Is that how it works?
Any help appreciated...
I am currently a Basic Rate 20% tax payer (up to £43k) and I am looking to rent out my flat. Going by the . gov website it will put me above my income threshold and would make me a Higher Rate 40% tax payer (£43k+) i.e £35k salary and £8.5k income from my flat = £43.5k total annual income. Is that how it works?
Any help appreciated...
0
Comments
-
I don't know the answer to your question but no question is stupid (even if some who post on here make you feel small with their sarcastic replies). If you want to know something that you do not already know ask a question.0
-
If you are in England
https://www.gov.uk/income-tax-rates
If you are in Scotland
http://www.gov.scot/Topics/Government/Finance/scottishapproach/Scottishincometax2018-20190 -
Not a silly question at all!
I am also interested to understand how the new rules on interest relating to property income are calculated.
Previously, you took the income, deducted the expenses, and put the net profit on the tax return.
I believe that as the reliefs for mortgage interest on let property have changed from 17/18, the income from property is now added in with other income before expenses are taken off.
So possible to be in theory a higher rate tax payer, as the property income takes you into the band, but not be making much profit as once the expenses come off, you still have a tax liability that you may not have had in previous years.
Sorry -not explaining very well - which shows that I probably do not fully understand it properly.
Can anyone give a 101 explanation of this please? Thank you!0 -
You can lower your income (I beleive) by making pension contributions so as to cancel out the additional rental income.0
-
pinklady21 wrote: »Can anyone give a 101 explanation of this please? Thank you!
https://www.gov.uk/guidance/changes-to-tax-relief-for-residential-landlords-how-its-worked-out-including-case-studies0 -
FrankRizzo wrote: »£35k salary and £8.5k income from my flat = £43.5k total annual income. Is that how it works?
Any help appreciated...
higher rate tax bracket for 18/19 starts at 46,350 so not really sure what you are thinking, you area and will be a basic rate taxpayer on those figures0
This discussion has been closed.
Categories
- All Categories
- 343.3K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608.1K Mortgages, Homes & Bills
- 173.1K Life & Family
- 248K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards