property income lower than tax return threshold - what details?

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    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

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