Some basic information please for new landlords who rent

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  • jpkeates
    replied
    Originally posted by jpucng62 View Post
    IYou should also issue the paperwork (not sure exactly what it is) that says they intend to move back in at some point as this may be necessary in order to get the tenants to leave when they wish to move back.
    The best example of what is required is probably in the government's model tenancy agreement template, where it's Annex 2.

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  • jpucng62
    replied
    I would second Landlord-man's comment that renting out your home and then moving back in later can be pretty tough - tenants may or may not look after your home.

    You should also issue the paperwork (not sure exactly what it is) that says they intend to move back in at some point as this may be necessary in order to get the tenants to leave when they wish to move back.

    Good luck

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  • MarSel
    replied
    Thank you both so much for taking time to answer my question and for explaining clearly. Yes my dad still works he is 60 but my mother does not. It did not occur to me it will be a 50/50 but that could help a little.

    It is all very new to us, thank you again and your help is much appreciated.

    Leave a comment:


  • landlord-man
    replied
    Firstly - are they emotionally attached to their home in the North East?

    Hopefully not as it is highly likely not going to be in the condition they remember after 3 or 4 years of letting and that can be heart-breaking for some owners when they move back in.

    The rent has to be declared as income together with any other income they have - and at a 50/50 split which is not ideal if one of your parents still works etc. They can split the profits differently IF the property is owned in unequal share and relevant to that split.

    Oh it would be nice to use their rental outgoing to offset the incoming rent - but no, they cannot.

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  • jpucng62
    replied
    The simple answer is no - they cannot offset the rent they pay against the rent they receive - they get to pay tax on received rent & pay rent out of taxed income. I know this seems unfair but it is how it is.

    In terms of what they can offset against income received, anything that is solely related to the renting of the property: gas safety; EICR; EPC; management fees; any maintenance they have to do.

    As they are now LLs they must declare this to HMRC & fill in a self assessment. All rent & costs can be shared between them and the net profits will be added to another income they received and taxed at their marginal rates.

    If it is beneficial, you can split the profit unevenly but you need to tell HMRS you are doing this.

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  • Some basic information please for new landlords who rent

    Good afternoon everyone and thank you for taking time to read my post.

    My parents have recently relocated to South Yorkshire from North East due to a family situation. They own a house in the north east that is not mortgaged (owned outright) and they are now renting a house in Sheffield.

    We have advertised their house in the North East through a rental agency and have a potential tenant and we are learning so much about being landlords it is very overwhelming for my parents.

    They are asking for £700 a month rent for their house and they are paying £1000 to rent a place here in Sheffield. We understand we have to declare their rental income for tax purposes. I am trying to find information on how this tax is applied and expenses that can be claimed etc.

    My main question is this please, since they only own one property which until recently was their main residence and they have to pay rent to live in Sheffield (they only want to do this for a few years and then move back to their home in the North East), can they not offset any amount of the rent they are paying against the rent they will receive?

    Thank you for all your help and advice in advance.

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