Property Owner But Rent Goes Elsewhere

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Property Owner But Rent Goes Elsewhere

    I am the legal owner of a BTL and pay the mortgage

    However, my family member is the 'landlord' as she manages the place (e.g. arranges repairs, certificates, liaising with tenant etc).

    What I want to know is if it is okay for her to collect the rent to keep for herself? or is this illegal



    #2
    If she is working as agent, and taking the commission then it would not be illegal, if however she is taking all the money and not transferring anything back to yourself, then you would still need to declare this for tax purposes, you may also breach your insurance, and BTL mortgage terms.

    Comment


      #3
      A landlord does not have to own the property. Do you have a written agreement signed by both covering the relationship between the two of you?

      Is she registered with a lettings agent redress scheme?

      What training bit experience has she to do this for you?

      She is declaring all ( ALL ) rent income to HMRC and paying tax on it? Who has insured the property? Do terms of mortgage & insurance permit this sort of arrangement? (V unlikely for mortgage, could be repossessed if the case).

      When did this scheme start, please? Does she live in UK - if so which country? Have you seen a copy of the tenancy signed by occupants? (In particular have proof who is named as landlord and at what address)
      I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

      Comment


        #4
        theartfullodger,

        It is probably not wise to disclose too much info online.

        I will check my mortgage/insurance first... and yes all funds will be disclosed.

        Thank you

        Comment


          #5
          Originally posted by Cotton View Post
          I am the legal owner of a BTL and pay the mortgage
          However, my family member is the 'landlord' as she manages the place (e.g. arranges repairs, certificates, liaising with tenant etc).
          What I want to know is if it is okay for her to collect the rent to keep for herself? or is this illegal
          It's not illegal, but it is complicated for tax purposes.
          There's a reasonable chance you'll end up being taxed on the income without actually receiving it.

          And, as noted above, if you have a mortgage on the property, the terms may not allow such an arrangement.
          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).

          Comment


            #6
            Originally posted by Cotton View Post
            theartfullodger,

            It is probably not wise to disclose too much info online.

            I will check my mortgage/insurance first... and yes all funds will be disclosed.

            Thank you
            I do hope that;s not because she;s not registered with any redress scheme and/or has little or no training or experience in this game.

            Property letting is a legal minefield, never mind iffy tenants (or agents). Excuse the comment, but to save you the pain I went through, whatever you Cotton do, (if you haven't already - assuming you have done as you've been a landlord for a bit) - strongly recommend you do some basic training and reading up.

            When I started I made dumb, complicated, long-drawn-out, painful mistakes: Expensive, messy. I would have saved time & money if I'd just done some basic training, but I'm assuming you are ahead on that...

            For this sort of arrangement there usually needs to be a tenancy agreement between owner & "agent", granting tenancy to "agent", permitting them to rent to humans. In my 'umble, limited, experience insurers and mortgages do not usually permit these.

            If you want to see an example speak to one of the big agents who offer "guaranteed rent schemes/scams" which use this approach (but theirs will favour agent)

            Good luck!
            I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

            Comment


              #7
              Why don't you simply add her as an employee and pay her from the rental amount, to avoid the issues previously mentioned or alternatively she invoices you on periodic basis.

              Comment

              Latest Activity

              Collapse

              • Reply to Previous tenant paid last gas bill based on wrong estimated reading by gas company
                by jpucng62
                I think the company has an obligation to get an actual meter reading at least every 2 years - during covid they accepted photos in place of sending in a meter reader - you could try getting them to accept at least some of the blame.
                20-01-2022, 15:25 PM
              • Reply to Tenant would like loft conversion - dilemma
                by Hudson01
                To agree with the above comments, i would not do it. If your tenant came along with a whole load of other builders quoting for the same job then what are the chances you would pick him as being the very best bet ? Just because his is your tenant does not make him the ideal choice..... if anything it...
                20-01-2022, 15:24 PM
              • Reply to Greetings, I Come in Peace
                by jpucng62
                Also consider the date of the EPC - the assessment has change a lot since they came in 10 years ago and and old assessment may be out by quite a lot of points or may have had work done that is not reflected in the EPC.

                I had a house lose 10 points in 10 years without anything else chan...
                20-01-2022, 15:22 PM
              • Reply to Greetings, I Come in Peace
                by jpucng62
                Some upgrades are easy - LED light bulbs, loft insulation; others much more tricky - floor insulation; party wall insulation; some are just very expensive - external wall insulation.

                The EPC assessment is not fit for purpose so it is really tricky to know what to do. What I wouldn't do...
                20-01-2022, 15:20 PM
              • Section 21 superseded new Section 21 - Landlord Vs Tenant 1 Vs Tenant 2
                by propster717
                Hi all,

                I would be grateful for any advice:

                I'm a landlord as follows:

                AST - commenced 12/04/2021
                6 month fixed term, now contractual periodic (has not been renewed).
                Tenant 1
                Tenant 2
                (No children)
                Guarantor (relation of Tenant 1)...
                20-01-2022, 15:12 PM
              • Reply to Ending of a tenancy
                by Jon66
                I don't want to rain on everyone's parade, but I do not wait for tenants to move out before marketing the property, and I sign the new tenancy agreement providing the current tenant has not attempted to rescind the notice/everything seems to point to them leaving, when they said they would. A 6 week...
                20-01-2022, 15:07 PM
              • Reply to Greetings, I Come in Peace
                by jpucng62
                The last 20 years may have been the 'golden years' for BTL. There is more regulation & higher taxation on BTLs; mortgage costs are going up; tenants are getting more rights & EPC C is coming.

                The stock market is the place to go instead - £20k per year in an ISA means all tax is...
                20-01-2022, 15:07 PM
              • Reply to N244 Application Notice Q10 Evidence
                by rapid111111
                Thanks for the reply. This is a different case.
                The defendants are asking to set aside. Any paperwork sent to me has come from the courts only and not them.

                I've provided the defendants and the court with paperwork in preparation for the hearing to set aside....
                20-01-2022, 15:03 PM
              • Reply to Greetings, I Come in Peace
                by davetg
                I still can't think of a better thing to invest in even given all the new regulations. The lessons i have learnt are:-
                1) Never let to people on benefits.
                2) Don't over leverage your borrowing.
                3) Have access to spare funds for unexpected things like a new boiler being required or...
                20-01-2022, 15:00 PM
              • Reply to Possession hearing
                by davetg
                The two I have done were quite informal - the tenants didn't show up so I had to wait quite a while as they give every opportunity for them to arrive late.

                I was shown into a room with the judge sitting at a big table and offered a seat on the other side of the table. The judge looked at...
                20-01-2022, 14:49 PM
              Working...
              X