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bigduckontax, Accountant
Category: Tax
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I own a property with my husband jointly. We purchased it together

Customer Question

I own a property with my husband jointly. We purchased it together before we got married. It has recently been rented out. I would like to know if I can claim the rental income as solely mine or if the rental come has to be equally split? I am not currently employed. My husband works full time. We intend to sell this property in the near future.
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.

In order to do this you must be able to prove that all activities in relation to the management of the lettings devolved upon you and not the other joint tenant. Then, and only then, may the rental, and I only say may as you have to convince HMRC, will be your income. Under normal process, of course, the rental will be assumed split 50/50 with the other joint tenant. Any expenses eg Council Tax, utilities, insurance, repairs etc may be deducted from rentals. Here is the Which guide on the subject:

'Allowable expenses a landlord can claim

The most common types of expenses you can deduct are:

water rates, council tax, gas and electricity
Maintenance and repairs to the property (but not improvements)
Contents insurance
Interest on a mortgage to buy the property
Costs of services, including the wages of gardeners and cleaners
letting agents fees
Legal fees for lets of a year or less, or for renewing a lease of less than 50 years
Accountant’s fees
Rents, ground rents and service charges
Direct costs such as phone calls, stationery and advertising for new tenants

The expense should be incurred wholly and exclusively as a result of renting out your property.'

Note particularly the last paragraph.

I do hope I have thrown some light on your situation.
Customer: replied 2 years ago.
Thank you. It is important that I make sure the tax situation is above board as my husband is a police officer. I have managed everything in relation to the property and the tenants. I have a ten year background in property management as my previous employment before having my children. If the HMRC do not agree with me what will be the penalty/result?
Expert:  bigduckontax replied 2 years ago.
There will be no penalty, they will merely adjust your husband's tax position to reflect 50% of the rental. However, from the information you have provided I am of the opinion that a refusal to allow the rental against you is highly unlikely and if refused should be immediately subject to an appeal, mainly to push it higher up the decision making chain in your tax office.

Just keep plugging away!
Customer: replied 2 years ago.
Thank you. Sorry last question. In this instance I am the only one who should register with the tax office? My husband has no reason to complete a tax return if I am solely claiming the rental income? Thanks again!
Expert:  bigduckontax replied 2 years ago.
Your husband has to self assess for Income Tax if he is in receipt of income which has not suffered tax at source. So as it stands at the moment there is no requirement for him so to do.
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3617
Experience: FCCA FCMA CGMA ACIS
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Expert:  bigduckontax replied 2 years ago.
Thank you for your support.

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