Renting out multiple rooms in own home (where I live)

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    #16
    Originally posted by TaxationPete View Post
    You refered to a lower limit of £40,000. Letting relief will be a available to you up to a maximum of £40,000 In the example you quote the property attracted £24,000. LR is basically the gain on the property divided by the total number of days you have owned it, apportioned by the established rental ratio and then multiplied by the acually number of days you have rental the rooms out. Regards Peter
    But surely by copying their example, if I only let 30% of my property, then I will get PPR on 70% of the gain on selling, and the remaining 30% will need to exceed £40,000 before it ceases get Letting Relief. If 30% of my gain exceeds £40k, then my total gain on the property will need to exceed £133k surely?

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      #17
      You can not move the % apportionment to suit your tax position The % is fixed by the floor area and may be measured by the District Valuer to validate your claim. Regards Peter

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        #18
        Sorry, just to make sure I understand...

        I'm not trying to move the % to suit my tax position, I'm just trying to be fair with it. So in my calcs, 30% for mortgage interest because that's the % that will be 'tenant's only', but I've said 75% for other things because that is a fair split, we will all use an equal share of water (for example) - are you saying that the floor area % must be applied to all expenses? If so then I'll definitely be much better with RaR...

        By the way thanks for your conitnued advice Peter, it's much appreciated

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          #19
          How can you have 30% and 75%. 25/75 Or 30/70 if that is the fact. The established apportionment applies to all allowanace and expenses. Regards Peter

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            #20
            Originally posted by TaxationPete View Post
            How can you have 30% and 75%. 25/75 Or 30/70 if that is the fact. The established apportionment applies to all allowanace and expenses. Regards Peter
            My logic for different %s was that things like water should be equally shared, so if I have 3 lodgers then they would be 75% of the total, but for things like mortgage interest it says only the floor space in your property that is exclusively for the tenants, so about 30% in my case. I was trying to judge each expense fairly - but from what you are saying it sounds like the floor space thing applies to all expenses - in which case RaR will be much better for me. So be it.

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              #21
              Sorry, posted in error here.

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              Latest Activity

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              • Caught out by changes to Capital Gains Tax
                by reluctantlandlord1976
                I appreciate 'ignorance' is no excuse, however there are some mitigating factors, i.e. due to illness etc.

                1. Previous family home rented out - terrible tenants - left owing rent, bad repairs etc. [usual story for some] subsequently property not let for 2 years for a number of reasons while...
                06-12-2021, 13:51 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by reluctantlandlord1976
                Thank you Gordon, didn't see your response this afternoon. I will look at this with fresh eyes tomorrow as it's late now.
                I've put some figures in my reply to a post just now but answers below to your questions.

                a] £80k Jan 2021 sale price.
                b] As property purchased before...
                08-12-2021, 00:55 AM
              • Reply to Caught out by changes to Capital Gains Tax
                by reluctantlandlord1976
                Andrew, apologies only just seen your post [was it awaiting approval did you say?] answers are:

                Purchased March 1982 as joint tenancy - so equal split of 33 1/3% each party
                Parent 2 died September 2007 - as joint tenancy I inherited their share - so at this point I own 100% of property...
                08-12-2021, 00:41 AM
              • Reply to Caught out by changes to Capital Gains Tax
                by reluctantlandlord1976
                JP Keates
                I wasn't aware that refurbishment deductions only applied in terms of letting out the property. On the CGT calculator it asked 'How much have you spent on improvements since you became the property owner'.....

                Here's the timeline:

                March 1982 - 1992 3 Owners,...
                07-12-2021, 18:01 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by reluctantlandlord1976
                JP Keates et al - thank you very much for your assistance. I have this afternoon emailed an accountant to try and get an appointment urgently. I hadn't realised it was all so complicated and it was remiss of me to not be aware of the CGT changes made in 2020 due to not renting out the property. Thanks...
                07-12-2021, 17:28 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by jpkeates
                Refurbishment while you were living there is only allowable against CGT if it was solely and exclusively for the business, so if it was to prepare the property to be let, it would be OK.
                If it was simply to improve what was then your home, it fails the basic test.

                Get yourself to...
                07-12-2021, 16:22 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by AndrewDod
                The probate resets a lot of the stuff, but my main response was unapproved
                07-12-2021, 15:36 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by AndrewDod
                You are really short on detail:

                Date (year & month) bought in joint names ______ (what % was yours then)
                Date it converted to your sole name ______ (presumable date of death of parent 2?)
                Declared vale at probate _________
                Capital expenses between date of probate 2...
                07-12-2021, 15:33 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by reluctantlandlord1976
                We were all joint owners. Bought it with parents. I lived there for 10 years before buying own home. I became sole owner upon their deaths. Rented out since 2007-2019. Empty last two year as trying to sell. Hence I was off the landlord radar. I am now extremely worried by your statement that refurbishment...
                07-12-2021, 14:53 PM
              • Reply to Caught out by changes to Capital Gains Tax
                by AndrewDod
                Let us know the exact timescale and money involved year by year - I am sure some kind person (or even myself) with do a calculation for you so that you can assess the risks involved
                07-12-2021, 14:33 PM
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