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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10915
Experience:  Solicitor with 5+ years experience
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I have rented out my property and am living with my partner.

Customer Question

I have rented out my property and am living with my partner. My net income is about £10000. I have read an article on 'Accidental Landlords' and think I maybe get an allowance of over £10000 but I can't get anyone at the tax office to acknowledge anything about 'Accidental Landlords'. I have now registered for a 'Self Assessment' form as I have always paid my tax through PAYE. I am now retired and have an income of about £14000 not counting my rental income.
Submitted: 2 years ago.
Category: Law
Expert:  Ash replied 2 years ago.

Alex Watts : Hello my nam is Alex and I will help you with this.
Alex Watts : Have you ever been declaring the rental income to HMrC please?
JACUSTOMER-etnr6tjp- :

No, I have not been declaring the rental income thinking that I would do a tax return before October and pay a lump sum, but I am confused about the Accidental Landlords statement.

Alex Watts :

Ok - do you have the web link for the article please?

JACUSTOMER-etnr6tjp- :

No, I do not have the web link... it was just random but I did read another article in the Times or Telegraph which I cut out but that was back in January.

Alex Watts :

ok - how much are you renting or for and how much is your mortgage interest?

JACUSTOMER-etnr6tjp- :

I am renting out for £12500 approx a month and I don't have a mortage. As I said, I am retired and moved in with my partner.

Alex Watts :

Thank you. Do you have other income?

JACUSTOMER-etnr6tjp- :

Yes, about £14000 from pensions.

Alex Watts :

Ok - sadly you should have declared this income

Alex Watts :

This is because it is income which is untaxed.

Alex Watts :

This means sadly you owe tax on the rental income less any direct expenses.

Alex Watts :

You do get a tax free allowance:

Alex Watts :

Born after 5 April 1948

£10,000

Alex Watts :

Born between 6 April 1938 and 5 April 1948

£10,500

Alex Watts :

Born before 6 April 1938

£10,660

Alex Watts :

So you would owe tax on 20% of that difference

Alex Watts :

Can I clarify anything for you about this today please?

JACUSTOMER-etnr6tjp- :

So, you haven't found out about Accidental Landlords ... and the extra relief, which is what I was asking in the first place. I of course know about my allowance ... why do you say, sadly I should have declared this income? I will pay on assessment during the next tax year which is what I thought I should do.

JACUSTOMER-etnr6tjp- :

Have you found out .... or do you know... anything about Accidental Landlords (as opposed to buy to let landlords) ... Of course I know about my allowance before tax and I will self assess my income and declare it before the end of October.

JACUSTOMER-etnr6tjp- :

Have you found out or do you know anything about Accidental Landlords and the allowance that goes with that?

Alex Watts : You don't get any extra relief for being an accidental landlord.
Alex Watts : I have read an article for both the times and telegraph.
Alex Watts : There is no tax relief for an accidental landlord. Hmrc are quick to make sure you pay tax on that Income.
Alex Watts : But there is nothing in law or within the tax position that gives you an extra £10,000 for being an accidental landlord
Alex Watts : You are entitled to a tax free sum if you have a lodger, but this is not the case here.
Alex Watts : Can I clarify anything else for you?

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