HMRC Admin 19 Response
-
RE: Deed of Trust - Transferring Income to Spouse
Hi,
You can see guidance here:
TSEM9530 - Ownership and income tax: express trusts - deed
We do not require sight of this but may ask for it at a later date.
Please be aware that certain trusts may need to be registered with HMRC, you can see more information here:
Register a trust as a trustee
Thank you. -
RE: Who pays income tax on a fifted property?
Hi,
As you are in the process of considering gifting a rental property to your son, we would only be able to offer limited advice. You can see guidance here:
TSEM9918 - Ownership and income tax: Specific types of property: land and buildings - taxation of rental income
TSEM9920 - Ownership and income tax: Specific types of property: land and buildings - examples
Thank you. -
RE: How to pay tax on UK rental income when non-resident for tax purposes.
Hi,
As a non-resident in the United Kingdom, certain countries residency does not guarantee personal allowances shall be given. You need to refer to the country of residence's Double Taxation Agreement with the United Kingdom for further information:
Tax treaties
Further to this, deductions such as underpayments, benefits in kind, would need to be considered also.
In relation to the original response, please follow guidance on tax on foreign income which states you may need to pay UK Income Tax on your foreign income, such as wages if you work abroad, here:
Tax on foreign income
If declaration is required, you would insert this within the SA106 Foreign page.
As per the previous response, you would receive mortgage interest relief at the basic rate.
Thank you. -
RE: Updating NRL Information
Hi,
You would need to contact our Non-Resident Landlord team in order to inform us of a change to legging agent.
Non-UK resident landlords
Thank you. -
RE: Tax deductibility of a loan
Hi,
The following guidance confirms thst as long as the loan taken out is wholly and exclusively used for the rental business, this would be an allowable expense and would be declared in the “Loan interest and other financial costs” box.
PIM2010 - Deductions: general rules: applying the wholly & exclusively rule
Thank you. -
RE: Rental Income - Expense Allowance
Hi,
Usually the rental business does not begin until the first property is let. Any expenses incurred before the first let must be solely for the rental business and must not be capital expenditure. Any qualifying pre-letting expenses are treated as incurred on the day the rental business commences.
If you have already let your first property in 2024 to 2025 then the expenses will be incurred in 2024 to 2025. There is no splitting expense into different tax years. You can see guidance here: PIM2505 - Beginning and end of a rental business: commencement
Any loss that you make in 2024 to 2025 can be carried forward to later tax years so you are not losing out.
The main method of relieving a loss is to carry it forward and deduct it from future rental business profits. When carrying forward a loss you must use it in full against the first available rental business profits. You cannot opt to take a smaller amount. You can see guidance here:
Losses
Thank you.
-
RE: Letting fee expenses for finding new Non-residential tenant
Hi,
Agent fees paid by landlords for services related to their rental property are tax deductible against rental income. This includes fees for letting agents. To qualify as an allowable expense, the fee must be incurred wholly and exclusively for the rental business. You can see guidance here:
PIM2120 - Deductions: main types of expense: legal and professional costs
Thank you. -
RE: Reclaiming tax paid by letting agent
Hi,
Your letting agent has a legal duty to deduct the tax on your behalf as a non resident landlord unless notified by HMRC. This is an arrangement under the Non Resident Landlord Scheme. Your letting agent must make the 20% deduction regardless of how much rental income is received. You can account for the tax deducted at box 21 on SA105 UK property page. Your agent should also have record of any deductions made.
Thank you. -
RE: FHL Losses
Hi,
You can see guidance here:
PIM4120 - Furnished holiday lettings: treatment of FHL losses for 2011-12 onwards
If a furnised holiday let makes a loss it can set it against FHL profits in a later year. However, a loss can only be carried forward against a profit of the same FHL business.
Thank you. -
RE: Rent a room relief & rental income for same property