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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15753
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Hello - I am a part time teacher earning £18000 and PAYE we

Customer Question

Hello - I am a part time teacher earning £18000 and PAYE we have a property which we own and is let out - income £7800 also attached flat to our rented house is a holiday sublet income-£3250. I am in the process of self assessing online 2013-14 and am a bit bamboozled. final tax bill £2875 any advice on how I can get this down ?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

Can you give me a little more information about the lettings please. Am I correct in my understanding that you have a house that you let and you received £7,800 in rent during 2013/14 and that there is a flat attached to the let house which is let to holiday makers and you received £3,250 in rent in 2013/14?

Is the flat let under the furnished holiday letting rules which you can read about here? Are there any mortgages on the properties? What expenses have you incurred in running the lets in 2013/14? Are the house and the flat on separate titles and are they owned jointly with somebody else?

Can you let me know what your gross pay and tax deducted were from your teaching P60 for 2013/14 please.
Customer: replied 2 years ago.

What you say in para 1 is correct. As far as I know the flat is an FHL we pay heat light - contents insurance and it is furnished and serviced by us. I have an online booking system. Buildings insurance on the house we own. The house is owned by us the flat is attached to our rented property and sublet with the consent of the owner.

My gross pay 2013/14 was £17994.82

Expert:  TonyTax replied 2 years ago.
Thanks.

You didn't tell me how much tax was deducted from your salary. Is the flat attached to the property you live in yourself? Is it self-contained?
Customer: replied 2 years ago.

Tax deducted on my pay £1424.20

yes the flat is attached to the property we live in ourselves and is self contained - separate entrance

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 2 years ago.
Hi again.

I'm having a little internet trouble right now just as I'm drafting my answer so please bear with me while I try to sort things out.
Expert:  TonyTax replied 2 years ago.

Hi again.

You have underpaid tax on your salary by £286.60 (£17,994 - £9,440 x 20%).

You should only disclose your share of the letting income and expenses in your tax return.

You need to check HS253 to see if the flat you let qualified as a furnished holiday let in 2013/14. The helpsheet sets out the criteria. If it does, you can claim capital allowances for the cost of furniture, furnishings and white goods such as fridge freezers, ovens etc..

If it doesn't qualify as a furnished holiday let and this applies to the house you let out too, you cannot claim capital allowances for the furniture and white goods but if it is fully furnished, you can claim a wear and tear allowance which you can read about here, here, and here.

You can use the property income pages here and the notes here and here as a guide to the types of expenses you can claim against the income which will reduce the taxable profit if you incurred any such expenses.

I hope this helps but let me know if you have any further questions.

TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15753
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you
Customer: replied 2 years ago.

Thanks very much - I may need to come back to you but what you say is really useful

How do I get back to you if I logout or the page goes down ?

Expert:  TonyTax replied 2 years ago.
The content on this page won't be lost even if the site goes down and the question will always be here for you to acess. What I suggest you do is copy the page address and email it to yourself.
Customer: replied 2 years ago.

Morning Tonytax

Just looking back on the thread of this conversation....It is now over four years ago since I bought the furniture for our holiday let and I have not yet claimed capital allowances, and it now has four years of wear and tear. Can I claim for the original cost - as new ?

Happy new Year

Regards

Richard

Expert:  TonyTax replied 2 years ago.
Claim writing down capital allowances on the purchase price. You don't have to claim capital allowances if you don't want or need to for any particular year. For example, your profit may be so low that it would be wasting personal or capital allowances if the let was your only source of income and the profit was less than the PA.

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