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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
Satisfied Customers: 15332
Experience:  International tax
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I bought a house back in 2012, with the intention of it becoming

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I bought a house back in 2012, with the intention of it becoming a family home for me and my wife. For personal reasons we could not and cannot move, but I let my brother in law live there and he pays slightly less than half the mortgage. I am now led to believe I should be filling a tax return for this although I am losing money. Can you let me know how much I could be facing in terms of late filling penalities and (?) late tax payment?
Submitted: 1 year ago.
Category: Tax
Expert:  TaxRobin replied 1 year ago.
Hello,You may not have any tax to pay at all actually. If a taxpayer lets a property below the market rate to a relative (as opposed to providing it rent-free), they can deduct the expenses of that property up to the rent they get from it. This means that the uncommercially let property produces neither a profit nor a loss, but the excess expenses cannot be carried forward to be used in a later year. The Let Property Campaign is an opportunity for landlords who owe tax through letting out residential property. You may not have to pay any penalty at all but if you do it is likely to be lower than it would be if HMRC were to contact you.The penalties normally could be up to 100% of the unpaid liabilities but if you have no tax to pay because expenses you would not have any penalty.There is a Help line if you wish to notify and disclose https://www.gov.uk/government/organisations/hm-revenue-customs/contact/my-campaigns-let-property
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Customer: replied 1 year ago.

Hi, I'm concerned about the late filling penalties which I believe may be enforced even if I do have no tax to pay - can you tell me how much these might be?

Expert:  TaxRobin replied 1 year ago.
If you have no tax to pay the penalty could be £100.12 months late and that could rise to 5% (of tax) or £300 if greater, unless thetaxpayer is held to be deliberately withholding information that would enable HMRC to assess the tax due. You could avoid that potential by the disclosure.
Expert:  TaxRobin replied 1 year ago.
If my answer addressed your question please rate below or above (let me know if you have difficulty as I believe the system changed), if you need more information reply below.
Expert:  TaxRobin replied 1 year ago.
Wanted to touch base with you and make sure you could see my last response.

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