Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • chipolatta
    • By chipolatta 8th Jan 18, 8:42 PM
    • 13Posts
    • 1Thanks
    chipolatta
    Can landlord claim WTC?
    • #1
    • 8th Jan 18, 8:42 PM
    Can landlord claim WTC? 8th Jan 18 at 8:42 PM
    Hi all,
    Top and bottom of it is I lost my job a couple of years ago, struggling to find work, but have been renting out Mrs Chipolatta's flat, so have about £5k a year coming in from that.
    Been doing odd jobs cash in hand for folk locally, nothing stable or well paid, not been claiming benefits or tax credits, but push has come to shove, and I've put my pride aside and decided that we really do need extra money coming in.
    As a pro landlord (I guess), can we claim WTC? I punched the numbers into the online Tax Credit Calculator, and if I click the 'self employed' button and say I'm doing 25 hours a week, then the computer says 'yes'... So can a landlord claim WTC?
    Cheers,
    Chipper
Page 1
    • Darksparkle
    • By Darksparkle 8th Jan 18, 8:58 PM
    • 5,116 Posts
    • 3,320 Thanks
    Darksparkle
    • #2
    • 8th Jan 18, 8:58 PM
    • #2
    • 8th Jan 18, 8:58 PM
    Generally a landlord isn!!!8217;t considered self employed. Property letting is generally an investment rather than a business.

    May help to read here - https://www.gov.uk/hmrc-internal-manuals/national-insurance-manual/nim23800

    I assume your wife is declaring her rental income to HMRC?
    • chipolatta
    • By chipolatta 8th Jan 18, 9:15 PM
    • 13 Posts
    • 1 Thanks
    chipolatta
    • #3
    • 8th Jan 18, 9:15 PM
    • #3
    • 8th Jan 18, 9:15 PM
    Generally a landlord isnít considered self employed. Property letting is generally an investment rather than a business.

    May help to read here - link

    I assume your wife is declaring her rental income to HMRC?
    Originally posted by Darksparkle
    Thanks for the link Darksparkle, its very clear and interesting in the link. The question about claiming WTC arose when filing tax return and declaring the rent. It got me thinking that being that there's potentially tax due on the rents then couldnt it work the other way round too?
    • Darksparkle
    • By Darksparkle 8th Jan 18, 9:44 PM
    • 5,116 Posts
    • 3,320 Thanks
    Darksparkle
    • #4
    • 8th Jan 18, 9:44 PM
    • #4
    • 8th Jan 18, 9:44 PM
    Well no because not all income that is taxable is employment or self employment eg you pay tax on bank interest, you wouldn!!!8217;t claim WTC for that.
    • Darksparkle
    • By Darksparkle 8th Jan 18, 9:48 PM
    • 5,116 Posts
    • 3,320 Thanks
    Darksparkle
    • #5
    • 8th Jan 18, 9:48 PM
    • #5
    • 8th Jan 18, 9:48 PM
    Also there would be very little !!!8220;work!!!8221; to do with property to justify meeting the hours criteria of 16/24/30 (depending on circumstances).
    • xylophone
    • By xylophone 8th Jan 18, 9:54 PM
    • 25,577 Posts
    • 15,106 Thanks
    xylophone
    • #6
    • 8th Jan 18, 9:54 PM
    • #6
    • 8th Jan 18, 9:54 PM
    And see post 16

    http://forums.moneysavingexpert.com/showthread.php?p=73684632#post73684632
    • Pennywise
    • By Pennywise 9th Jan 18, 8:51 AM
    • 10,222 Posts
    • 19,035 Thanks
    Pennywise
    • #7
    • 9th Jan 18, 8:51 AM
    • #7
    • 9th Jan 18, 8:51 AM
    Hi all,
    Top and bottom of it is I lost my job a couple of years ago, struggling to find work, but have been renting out Mrs Chipolatta's flat, so have about £5k a year coming in from that.
    Been doing odd jobs cash in hand for folk locally, nothing stable or well paid, not been claiming benefits or tax credits, but push has come to shove, and I've put my pride aside and decided that we really do need extra money coming in.
    As a pro landlord (I guess), can we claim WTC? I punched the numbers into the online Tax Credit Calculator, and if I click the 'self employed' button and say I'm doing 25 hours a week, then the computer says 'yes'... So can a landlord claim WTC?
    Cheers,
    Chipper
    Originally posted by chipolatta
    How can you possibly spend 25 hours per week on renting out a single property?

    But as others have said, property letting isn't self employment, it's investment income, declared on the property pages of the SA tax return.
    • Cheeky_Monkey
    • By Cheeky_Monkey 9th Jan 18, 10:52 AM
    • 1,691 Posts
    • 3,570 Thanks
    Cheeky_Monkey
    • #8
    • 9th Jan 18, 10:52 AM
    • #8
    • 9th Jan 18, 10:52 AM
    Can't you just sell the flat? When the tenant leaves I mean.
    I used to be indecisive - now I'm not so sure
    • chipolatta
    • By chipolatta 9th Jan 18, 8:59 PM
    • 13 Posts
    • 1 Thanks
    chipolatta
    • #9
    • 9th Jan 18, 8:59 PM
    • #9
    • 9th Jan 18, 8:59 PM
    Thanks for the input everyone. Yes, the weekly hours would be quite a streach for just looking after the one flat, guess that wouldnt fly really. Maybe a landlord with a few properties running them as a full time bussiness while looking to expad can justify the hours though.
    Not sure about selling the flat, up here in the North they are cheap as chips so selling up will only gain some cash that won't last a long time, but renting it gives at least a small amount of steady income over the years.
    • Voyager2002
    • By Voyager2002 9th Jan 18, 9:32 PM
    • 12,145 Posts
    • 8,262 Thanks
    Voyager2002
    An additional point is that WTC is being replaced by Universal Credit. Under UC the value of the property would be considered as 'savings' and so you would fail the means test.
    • chipolatta
    • By chipolatta 9th Jan 18, 10:08 PM
    • 13 Posts
    • 1 Thanks
    chipolatta
    An additional point is that WTC is being replaced by Universal Credit. Under UC the value of the property would be considered as 'savings' and so you would fail the means test.
    Originally posted by Voyager2002
    Oh. I dont have a clue about UC, will have to read it up...
    • Afraid of Kittens
    • By Afraid of Kittens 10th Jan 18, 8:46 PM
    • 59 Posts
    • 56 Thanks
    Afraid of Kittens
    Yes they can - if they form a company - become a Director - pay themselves a Directors remuneration - and rent their properties out via their company.
    • chipolatta
    • By chipolatta 10th Jan 18, 10:13 PM
    • 13 Posts
    • 1 Thanks
    chipolatta
    Yes they can - if they form a company - become a Director - pay themselves a Directors remuneration - and rent their properties out via their company.
    Originally posted by Afraid of Kittens
    Interesting...
    • NYM
    • By NYM 10th Jan 18, 11:15 PM
    • 3,589 Posts
    • 6,618 Thanks
    NYM
    Not so interesting because to transfer the property to a limited company you will trigger a sale and repurchase, incurring capital gains tax, stamp duty plus the surcharge plus legal, valuation and mortgage fees.
    • chipolatta
    • By chipolatta 11th Jan 18, 12:37 AM
    • 13 Posts
    • 1 Thanks
    chipolatta
    Not so interesting because to transfer the property to a limited company you will trigger a sale and repurchase, incurring capital gains tax, stamp duty plus the surcharge plus legal, valuation and mortgage fees.
    Originally posted by NYM
    Maybe AfraidOfKittens means to start an estate agent type company, which only manages properties and not own any, pays a wage which would satisfy the WTC criteria?
    • Comms69
    • By Comms69 11th Jan 18, 10:35 AM
    • 2,970 Posts
    • 2,939 Thanks
    Comms69
    Maybe AfraidOfKittens means to start an estate agent type company, which only manages properties and not own any, pays a wage which would satisfy the WTC criteria?
    Originally posted by chipolatta


    But you would fail to pay yourself the minimum wage......


    Stop trying to fiddle the taxpayer, no-one appreciates it.
    • chipolatta
    • By chipolatta 11th Jan 18, 9:12 PM
    • 13 Posts
    • 1 Thanks
    chipolatta
    But you would fail to pay yourself the minimum wage......


    Stop trying to fiddle the taxpayer, no-one appreciates it.
    Originally posted by Comms69
    No one is trying to fiddle anything Comms69, just asked if a landlord can claim WTC.
    • Comms69
    • By Comms69 12th Jan 18, 9:51 AM
    • 2,970 Posts
    • 2,939 Thanks
    Comms69
    No one is trying to fiddle anything Comms69, just asked if a landlord can claim WTC.
    Originally posted by chipolatta


    Actually you were asking if you could set up a management company, to manage your own properties, so you could claim 25 hrs work, so you could claim WTC.


    I've pointed out a fundamental flaw in that.


    I'd suggest if you want WTC, you find a job / become self employed.
    • badmemory
    • By badmemory 12th Jan 18, 12:28 PM
    • 1,710 Posts
    • 2,308 Thanks
    badmemory
    And isn't it Mrs chipolatta's flat anyway? So actually you don't have an asset.
    • chipolatta
    • By chipolatta 13th Jan 18, 12:47 AM
    • 13 Posts
    • 1 Thanks
    chipolatta
    Thanks for the advice Comms69...
    Badmemory, yep, her flat. I don't think that affects any WTC though does it?
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

249Posts Today

3,408Users online

Martin's Twitter
  • RT @LaraLewington: ...and mine suggested I'd achieved a lifelong ambition of being sawn in half by a magician - at our wedding. Wasn't. Don?

  • We are working on it - I think BA has behaved awfully on this. Those flight were no obviously a glitch. It should? https://t.co/8pvtXtUEqi

  • RT @thenicolabryant: Absolutely. We need mental health and financial health as advocated my @MartinSLewis , to be taught in schools. So muc?

  • Follow Martin