One Landlord but two owners

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    One Landlord but two owners

    If a husband and wife own a property, and agree that it should be let out on an AST, is it acceptable for just one of them to be named as the landlord on the AST agreement (or does it need both of them?).

    #2
    From point of view of tenant it is perfectly fine and a legitimate tenancy contract

    From point of view of owners it is perfectly legal, and may also be perfectly fine depending on the agreement between them

    From the point of view of the taxman it would not be at all appropriate and will land you in a heap of trouble. If you own it 50:50 tax has to be paid 50:50 -- or different to 50:50 if the appropriate forms are filed with HMRC and it is also owned in that proportion.

    It always helps if you state who you are and what you are trying to achieve by your question.....

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      #3
      It's fine for one person to be named as the landlord - the landlord is whoever is named as such on the tenancy agreement, ownership of the property is academic.

      As above, for tax purposes, the position is slightly different - tax follows beneficial income and if the non-landlord partner received the benefit of the rent paid (which for a married couple would be usual) they would be liable for income tax.

      There are ways to avoid that.
      It's remotely possible that your financial affairs are so completely separate that it's not appropriate, but that is vanishingly rare and your existing team of tax experts would have been liaising with HMRC for years already.
      Or, you can use a Deed of Trust to apportion the income as you prefer - it's typically used to divert the bulk of the income to the spouse in the lowest tax bracket.
      You would need professional advice, because such a deed has impacts beyond tax - you are changing who actually owns what.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

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        #4
        AndrewDod,

        Is that correct? I only ask as my ex let out our joint tenancy property without my consent, and took all rent from the tenant without paying the mortgage (she kindly left me that). HMRC weren't in the least bit concerned with me, as I could prove I'd never received any of the income and had been paying the mortgage from my own salary - they went hell for leather after my ex for not declaring it though...

        Just seen JP's response, maybe because we weren't married - that might be the answer.

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          #5
          We are both intending to pay tax on the income. He is just abroad so it is easier for me to enter into the agreement

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            #6
            If one of you is abroad, it makes much more sense for the UK based person to be the landlord.
            The tax arrangements for landlords outside the UK are a bit fiddly, and I have no idea how it would work with joint landlords having a different tax treatment.
            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

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              #7
              hybrice,

              Yes, not being married makes a BIG difference. The tax split rules works totally differently for married folk.

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                #8
                Originally posted by HanMD View Post
                We are both intending to pay tax on the income. He is just abroad so it is easier for me to enter into the agreement
                If that is the sole reason (and assuming the tenancy is for three years or less) then the best way of proceeding is for the tenancy agreement to provide for both you and your husband to be landlords, but for you to sign "for self and co-landlord". That way there is no argument about who is the landlord. You avoid unnecessary complications, which should always be your aim when granting short term tenancies.

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