How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Sam Your Own Question
Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13947
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
16196420
Type Your Tax Question Here...
Sam is online now

My question is I am needing to move and have a fixed rate

Resolved Question:

Hi
My question is I am needing to move and have a fixed rate mortgage on my house which has 2 years left.
I pay £728 a month for the 12 year mortgage. I will be renting it out for only £725 (this is standard price but due to my short mortgage I will be at a loss)
The property I am renting is £900 a month.
From a tax perspective, will I need to pay 40% (my tax bracket) of £728 minus letting fees and building insurance?
Submitted: 1 year ago.
Category: Tax
Customer: replied 1 year ago.
Posted by JustAnswer at customer's request) Hello. I would like to request the following Expert Service(s) from you: Live Phone Call. Let me know if you need more information, or send me the service offer(s) so we can proceed.
Expert:  Sam replied 1 year ago.

Hi

Thanks for your question - I am Sam and I am one of the UK tax experts here on Just Answer.

Of the £728 you pay for the mortgage payment, how much of this is attributable to the interest charges? AS the capital repayment element of the payment is NOT an allowable expense against the rental income - just the interest I am afraid.

So the rental income position will be £725 less interest of the mortgage, lettings fees, building insurance (along with any landlord insurance and repairs and maintenance whilst you have tenants in situ)

Then anything left over is added to you notmal income and if you are a 40% taxpayer then you ewill pay 40% tax on this

Let me know if I can assist further

Thanks

Sam

Expert:  Sam replied 1 year ago.

Hi

You indicate you wish a phone call - I can send an additional services request for this - but it will involve a further fee - do you wish to proceed?

Thanks

Sam

Customer: replied 1 year ago.
No - that explains everything. So I just need to set up myself on self assessment and once a year complete this then I guess?thanksBen
Expert:  Sam replied 1 year ago.

Hi

Yes thats correct - and ask your lender to provide you with a certificate of interest paid after each 5th April - as its easier then to extract the interest figure as whole!

If you have all that you need, then please do take the time to rate me for the level of service I have provided, or click accept

Thanks

Sam

Sam and other Tax Specialists are ready to help you