my mum is moving away, so i was gonna pay her mortgage and live here

[mollieframpton]

My mum is moving away to leeds, she wants to rent a property up there so incase she doesnt like it, she can move down back down here, she has contents and building insurance as well as her mortgage, she said me and my parter are able to live here if we pay her mortgage off her,

she wont make no profit on the property. will she have to pay any tax on this, even though shes making no profit on this?

[Mrs Mug]

You and your mother should read the link below, so that you understand all of her legal obligations of being a landlord.

http://forums.moneysavingexpert.com/...2&postcount=12

Your mother may not have to pay any tax on her rental income, but she still has to declare it to HMRC.

[Gordon999]

Your mum has a personal allowance of 8105 pounds before 20% tax rate is charged on her remaining income after deducting 8105.

The taxable profit calculated from renting to you is 12 months mortgage payments minus 12 months loan interest and minus the buildings insurance.

[ram]

"she wont make no profit on the property"
reads that she will not be getting "no profit", therefore she must be getting some

If you mean no profit
a) She will make no profit
b) she wont make any profit.

It makes a difference to our answers sometimes if information is not precise.

[Snorkerz]

She probably will be making a profit because you will be paying off some of the capital value of her mortgage - so when the time comes to sell there will be a tiny bit of the property that your 'funds' have paid for.

[mollieframpton]

She won't make any profit were just paying off her mortgage payment each month

[Snorkerz]

She won't make any profit were just paying off her mortgage payment each month

Yes, and that mortgage is buying her a house, which is hers to keep at the end. That is why HMRC will allow 'interest' against rental income but not all of the mortgage.

Let's take this to extremes.

Mum puts down £10k and buys £100k house with £90k mortgage.

You pay £535 a month and stay there for 25 years (mortgage amount)

Allowing for inflation, after 25 years Mum owns a house worth £200k.

That's £190k (£7,600 pa) profit but you have only paid the mortgage.

[lorddan02]

why not just give your mum the cash? and she uses it to pay the mortgage off? it's as if you don't exist. she's hardly going to evict you so no need for an AST.