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bigduckontax, Accountant
Category: Tax
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I'm owning buy to let property years. I do not generate

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I'm owning buy to let property for 8 years. I do not generate income because my expences were bigger than rental income. I didn't declare it to tax man so far, because I haven't got income. This property cost me money every year until now. I have managed to change mortgage and now I have started to make money. How should I start with tax man?
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. You definitely need to make self assessment tax returns for the tax years you are making a surplus. The interest element only of your mortgage repayments are allowable against rental income. You also need to make your peace with HMRC as the losses you made in earlier tax years can be brought forward against current years profits. I would suggest that you should write a letter to you tax office setting out the full position, tax year by tax year. As there well may be, with brought forward losses, no loss of revenue you may find HMRC lenient on the matter of penalties which came in a couple of years ago. If you do owe tax for earlier tax years that Department may charge interest on unpaid tax. Be fair they do pay interest on over paid taxes. Put it simply, come clean to the tax man. I do hope that you find my reply of assistance.
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Thank you for your support. Time to write a grovelling letter!