Paying tax on ground rent

  • Filter
  • Time
  • Show
Clear All
new posts

    Paying tax on ground rent

    Hello good people,

    I have posted on LL before, but not for a while. I wanted to ask, been a P.A.Y.E person all my working life, but having purchased the freehold to the building containing my flat, which I live in, and another leasehold flat, which is rented out by the other leaseholder, I am wondering what happens about being taxed on ground rent.

    The ground rent at present is £75 p.a. Each. Obviously I cannot pay myself so it comes down to the ground rent I may get from the other leaseholder. First he flatly refused to pay me any. Then he did but the cheque bounced. That was back in 2012/13. Now he has phoned me to ask if I can send him the g.r requests for the last couple of payments. (????)

    Anyway, not sure what he is up to, BUT, with all the hysteria surrounding tax at the moment, what do I do about receiving this amount of ground rent and paying tax on it? I have paid over the last couple of years for things like repointing, plastering, roof maintenance, gutter clearing etc, none of which he has contributed to.

    Does that have any impact on things? If anyone could give me a rough idea of what I need to do or who I need to contact that would be really helpful. Have searched on here but not found anything that helps.

    Many thanks.


    Hi again,

    Have just seen a previous posting from January last year in reply to a guy who hadn't declared a very small amount of income from letting a property out for four years. The reply was to the effect that any income below £2500 a year could be declared to HM who could simply adjust the PAYE code for that person to take into account any vat they needed to pay. (I have actually seen this myself on HM website). I know it's only £75.00 p.a. in this case (x2 years) IF he pays me, but is that the way to do it please? That's if of course it's worth declaring anything as all the various expenses I've had would wipe out any amount of £75's he might pay me!!




      Yes, it is possible for "small" amounts of rental income to be included in your PAYE Coding.

      I suggest you contact HMRC. I would not be suprised if they were not that interested due to the potential minimal loss of tax.


        OK thanks for replying, I will give them a ring and hope I get someone who got out of bed the right side this morning.




          The other flat owner may be planning to sell and has to get his ground rent arrears cleared to remove any obstruction to a sale


            That's a point, I had wondered if he was trying to get matters sorted out for some reason, that could well be it. He put his tenants rent up recently, maybe trying to make it more attractive to a new buy to let owner....hmmm.

            Well I've sent the requests off, one for each outstanding year, so we wait and see. I don't trust him any further than I can throw him. And I've contacted HMRC, spoke to a very nice lady who sounded like everyone's favourite aunty.

            Yes you can just ring them, tell them about any extra "income" and they will either alter your tax code to compensate, or send you a payment slip to pay the extra tax on.

            It seems you can only get through on their "help" line if you ring before 10am, otherwise it appears to be set so it cuts you off, just a few seconds after asking you to remain on the line...........she did apologise, bless her.

            Thanks Gordon.



            Latest Activity


            • Let Property Campaign.
              by armour
              Hi all,

              A friend of mine has been renting out a flat since 2004 and has not declared any of the income to HMRC in all that time.

              She wants to come clean and pay the accumulated income tax she owes by making a non-prompted disclosure using the Let Property Campaign system....
              13-09-2021, 13:45 PM
            • Reply to Let Property Campaign.
              by theartfullodger

              Well done HMRC..

              None of my business, and obviously not in anyway a criticism of anybody, but If I had had a friend who I found out had been fiddling tax for 16 years they'd no longer be my friend.
              18-09-2021, 11:46 AM
            • Reply to Let Property Campaign.
              by armour
              Fair enough. Thanks for your advice. It is on cash basis.

              I guess it would only save her 50 odd quid anyway, maybe less than £80 once the fine and interest is added. I guess she'll have to swallow that.
              Once again, thanks JP and Gordon for your help.
              18-09-2021, 09:07 AM
            • Reply to Overseas Landlords
              by Santa Fe
              Boletus, thank you.
              17-09-2021, 18:37 PM
            • Overseas Landlords
              by Santa Fe
              I'm from UK but live overseas and recently discovered that I should be registered as an overseas landlord. I've done a bit of research on what it involves and it seems a bit of a headache - tenants have to fill out forms and pay tax from their rent direct to HMRC. If anyone here is registered as an...
              16-09-2021, 16:44 PM
            • Reply to Let Property Campaign.
              by jpkeates
              armour - Sorry, I don't know.
              It might depend on whether you're accounting on the cash basis (in which case I suspect not) or the accrual basis (when it's possible).

              But it's not something I ever got involved with when the W&T allowance existed, and all of the practical guidance...
              17-09-2021, 11:43 AM
            • Reply to Let Property Campaign.
              by armour
              Thanks JP, that's clear. I'll put the bathroom in with the income tax then. I guess it's much of a muchness anyway as the associated reduction in interest and fine will probably equal out.

              I have one last question, if you'd be so kind.

              During the year she had to make the eviction,...
              17-09-2021, 09:18 AM
            • Reply to Overseas Landlords
              by boletus
              You fill out this form requesting to have rental income without deduction of tax and pay it yourself;

              16-09-2021, 17:26 PM
            • Reply to Let Property Campaign.
              by jpkeates
              The 10% was for furnishings, so built in stuff should be ok to claim.
              The bathroom refurb depends on what was done if it was simply a replacement, it's maintenance, if it was a significant upgrade, it's likely to be part capital/part maintenance.
              If it's a new bathroom, it's probably ca...
              16-09-2021, 08:37 AM
            • Reply to Let Property Campaign.
              by armour
              Seems pretty clear there JP. I'll go ahead and alter my calculations

              One more thing, My friend had a bathroom refurb and a built in oven and hob replaced during the period when the flat was let furnished. I'm pretty sure that these costs can be detucted in addition to the 10% W&T, but...
              15-09-2021, 14:06 PM