Accidental landlord needs basic tax advice

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    Accidental landlord needs basic tax advice

    Hi all, first post here!
    My other half and I are shortly going to be moving to Cardiff to do a Masters course so will be letting out a 1 bedroom flat in London while we rent a property for ourselves.
    Never having done this before, the question I have is how is tax levied on any income from the rental of this property? Is the amount simply added to my or to her annual income and taxed at the appropriate rate of income tax or is it more complicated?
    We're not sure if we're going to go through a lettings agent yet, but is we do, is this something that they will sort out for us? Any advice would be very much appreciated.

    #2
    You will need to complete a tax return.

    You are taxed on your profit after interest and other bank income.

    Are you married/what? Who owns the flat?

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      #3
      Not married. The flat is in her name and she'll only be working part time while doing this course (2 years).

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        #4
        If it's her flat then the rental income is hers. Not yours.

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          #5
          I thought that may be the case. So will we need an accountant to sort this income out or can it be easily done on the HMRC website?

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            #6
            As has been said it is her income taxed against her. Morgage interest, rates, builging management fees, maintenance, buildings insurance, gas safety certificate, electrical safety cert every 5 year, agents fees, etc. etc. are all deductible from the rental gross income. You need to read up on what you can claim against the income. Is it furnished or unfurnished. Regards Peter

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              #7
              Thanks Peter, it's going to be let as a furnished property.
              I've been trawling the taxation section but wasn't able to find anything specific on this; I think the best thing to do will probably be to call HMRC and see if they can advise on which forms we're going to need.

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                #8
                You can also claim 10% of the gross income as Wear and Tear as it is furnished. Read up on this on the HMRC web site. The owner informs HMRC they are a landlord and they will issue the appropriate Self Assessment tax return at the appropriate time. I suggest you buy a couple of books on B2L. Regards Peter

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