Tax on rental income profit - HMRC want to tax all my profit - sounds odd.

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    Tax on rental income profit - HMRC want to tax all my profit - sounds odd.

    Hi - wondering if anyone has any advice here. I'm prepping my tax return, earning over the 100k threshold and have 1 rental property to declare profit on in my tax return. The property is joint owners with my civil partner. When filling in my tax return the calculation of tax owed is 100% of the profit I've declared. This doesn't seem right - I'd expect it to be between 40-60% based on tax bracket and deduction for earnings over 100k. Has anyone else experienced this or have any ideas what's happened? Thanks!

    #2
    Calculated by what or who?

    How are you calculating your profit?

    Some numbers would be helpful

    If you have a mortgage you might well pay 100% tax on what you regard as profit for certain number combinations

    Comment


      #3
      Are you completing a Form SA105 ( property tax return ) ?

      If the property is registered under joint names , then each joint owner will declare 50% of the 12 months rent and claim 50% of operating expenses .
      So, if the total one year rent was £10,000 and the expenses is £2000, then each joint owner will report a separate tax return showing rental income = £5,000 and expenses = £1000.

      So your rental profit may come to £4000 and be taxed at 45% .
      Your civil partner's profit may come to £4000 and could be taxed at 20% ??

      Comment

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