property income lower than tax return threshold - what details?

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

    property income lower than tax return threshold - what details?

    Hi

    The HMRC say that if your property income after expenses is less than £2500 then you can simply "tell them" what that income is. Do they mean a full breakdown like a tax return or simply just a number (as it seems to imply)

    e.g. Dear Sirs, I had additional income from property for the tax year x to x which after allowable expenses and mortgage tax credit was was £2000"

    Or, Dear Sirs, I had additional income from property for the tax year x to x which is detailed in the calculations below: [then list the following] rental, loss carried forward, mortgage interest, insurance, plumber call out, etc. etc., leaving £2000 which after the £50% tax credit for interest only mortgage payments means I owe £xxx, please send me a bill"

    ???????
    The person I spoke to just said to send details but when I asked if I should include the 50% tax credit I don;t think he understood....

    Thanks

    B

    #2
    Even on a tax return you just give a number. So your first paragraph is not correct.

    The sting is that if you get audited (as with a tax return) and you have told porky pies, you get severely punished for a long time. Bear in mind that they know a lot about you already, so you don't take chances with these people.

    Comment


      #3
      When you first tell HMRC that you have a new source of income, they're meant to agree with you (i.e. tell you) how you're going to report it.

      I'd call again and confirm that you have a new form of income and would like to know how to report it to them.
      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


        #4
        Thanks. I called them again: person 1 "i don't know", person 2 "you don't get a tax credit on the remainder of the mortgage interest tax relief", person 3 "send us your: gross profit, total expenses, mortgage costs and we'll work out the tax credit from that"

        Seems clear except I am now unsure if he meant gross income (though he did say several times gross profit)... I should have checked but I had mental fatigue by then!

        Gross profit in HMRC rental terms would be.........?????????

        Comment


          #5
          Is the property income your only taxable income?
          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
            Let's cut through this. Sometimes it is easier to just fill in a tax return. It's not hard - and even if you don't meet rules requiring you to complete one, they won't prevent you from doing so.

            Comment


              #7
              Thanks for the replies. In answer:
              No I have other income but am nowhere near the 40% income tax band, hence the end of tax relief on the mortgage won't affect me as I get the full credit back.
              Yes next time maybe I will do a tax return instead, but if I do one now then I will get a fine, whereas just declaring income I don't get a fine.

              Thanks

              Comment

              Latest Activity

              Collapse

              • Reply to Rent aroom property relief.
                by calista
                Thanks for your reply, this is what i thought, but couldn't find anything on the government page to back it up.
                01-04-2020, 21:13 PM
              • Rent aroom property relief.
                by calista
                Hi Qick Q i cant find the answer online..

                Can i claim rent a room relief on a rent of 300pounds a month at my first property where I live. 3600 a year.

                I rent a second property 1200 pcm, where I do not live and would not claim the rent a room relief- or rather i pay tax normally...
                31-03-2020, 12:10 PM
              • Reply to S24 deduction of interest payment / Covid-19 Virus
                by jpkeates
                I don't think that many landlords will pay any more tax, it'll catch some, but I'd have thought for the majority of landlords it's tax neutral.
                A small number of landlords will pay slightly more tax isn't much of a headline, though.

                At the time as s24 has been introduced, the personal...
                01-04-2020, 13:13 PM
              • S24 deduction of interest payment / Covid-19 Virus
                by Flashback1966
                I am wondering if S24 tax changes are going to come and haunt landlords.

                Under the tax changes landlords can't deduct interest payments in full. Individual Landlords have been paying more tax, then is fair.

                You could end up with a situation where the tenant wont or can't...
                01-04-2020, 08:06 AM
              • Reply to Selling part share
                by Bill31
                Im sure the reservation relies on the person who made the gift.
                If we was to sell the property and take our 50/50 share of the sale price would that release the gift with reservation if we then went on to buy our own property
                01-04-2020, 12:27 PM
              • Selling part share
                by Bill31
                5 years ago i gifted part of my property to my son as joint tenants. We lived in the property together. So its possibly a grob.

                Now we want to go our separate ways. Could he buy my share out so he owns the whole house. And i use the money to buy elsewhere. Could this introduce a IHT or...
                31-03-2020, 13:41 PM
              • Reply to Selling part share
                by jpkeates
                The reservation will depend (as far as I can see) on who pays the running costs of the property.
                If the running costs are split in line with the ownership, it's one thing, if the property is run as though it was the mother's house with her continuing to pay all the bills is another.
                01-04-2020, 09:58 AM
              • Reply to Selling part share
                by AndrewDod
                Well if CGT was not payable on the first slice it won't be on the second.

                I don't see that you retained a benefit, but I can't find any case law to that effect. But if rent was payable it would have gone in both directions (you would have paid your son half the rent and he would have paid...
                31-03-2020, 18:19 PM
              • Reply to Selling part share
                by Bill31
                Interesting that it may not be a grob as we own it all together. But surely hmrc will view it as i retained a benefit.

                Its our only main property i dnt think any cgt will be due. I was asking will cgt be due if i make another gift or sell my share to get my name of deeds?
                I ask because...
                31-03-2020, 17:35 PM
              • Reply to Selling part share
                by AndrewDod
                Although they were BOTH living there and both owned it -- so the share gifted is probably not a GROB. It would be if only the OP was living there (owning only a portion) and not paying rent.

                It depends on the proportion - if the OP owned 1% and paid no rent - I think it would be in GROB...
                31-03-2020, 17:09 PM
              Working...
              X