taxation of rental property for unmarried partners

Hi, I recently divorced my wife and so solely own property that I am renting out. I have a long term partner that I am not married to who also submits a Self Assessment Tax Return as part of her cleaning business. Can I apportion some of the rental income to her considering we are not married and she is not named on the deeds if I submit a Form 17 along with the associated Declaration of Trust please? She supports my in running the rental business and so this is a natural split of income

Hi ,
 

The Form 17 is for married couples and civil partners who both have an interest in a property. As you and your girlfriend are unmarried / not in a civil partnership, and as you are the sole owner of the property in question, you are responsible for reporting 100% of the rental income to HMRC and you are required to pay any tax that may be due. Domestic partners will often share income within the household, but the tax position is always based upon who is beneficially entitled to the income. If there was a legal change in beneficial ownership, and your partner became a legal owner or a beneficial owner through a declaration of trust, then you would both be taxed based upon your new shares in the property . Thank you .

Hi HMRC, Thanks for this advice. A quick question. If me and my girlfriend jointly own the rented out property, and we've decided that I will receive 100% of the rental profit, does she need to fill out a self assessment, or just me? Thanks!

Hi Ollie,
Thanks for your question.
If you have both decided to allocate 100% of the rental income to yourself, with your girlfriend receiving 0% of the beneficial interests (rental income and expenses) then for the aspect of rental property, if this is the sole property you rent then only yourself would need to complete the SA105 UK Property page of the Self-Assessment Tax Return.
Thank you.

Hi I own a rental property with my mother, (5% owned by myself and 95% owned by my mother) Reading the threads above. Am I correct in my assumption. that it can be agreed between myself and my mother, that I take 100% of the rental income and my mother receives Nil. Thank you.

Hi ,
 

Yes it could be agreed between you and your mother that you take 100% of the rental income and your mother takes nil but you would need to establish a deed of trust. Thank you .

Ah thank you Admin 17 Response for your quick reply. If the joint owners of a property are married, I understand from the guidance a Deed of Trust is required. As this is between my mum and I, would it be instead be ok for us to just to sign a document between us and have it witnessed. No need for a Deed as such. Kind regards.

Hi ,
 

Thank you for your question.  Where there is no partnership, the share of any profit or loss arising from jointly owned property will normally be the same as the share owned  in the property being let. But joint owners can agree a different division of profits and losses and so occasionally the share of the profits or losses will be different from the share in the property. The share for tax purposes must be the same as the share actually agreed. Further guidance can be found at : PIM1030 - Introduction: jointly owned property & partnerships  . Thank you .

Hi Thank you for your response. Therefore can you just confirm that even though we own the property as joint tenants we can still complete a form 17? Kind regards Sally

Hi,
A form 17 declaration is for a married couple or civil partners to complete to declare an unequal split of property. Therefore, in your case, as you are unmarried it is not correct to complete form 17. You would each declare your share of income from property separately to HMRC.
Thank you.

Hi. Me and my partner (unmarried /non civil partneship) have a jointly owned a property which we have rented for the last 6 years. Until now everything has been 50/50, in ownership / profits / tax liability. We would now like to revert to putting the profits (but not ownership share) into my name 100% as per the information on this thread. I would be grateful if you could answer the following: 1. We are registered as joint tenants rather than tenants in common, does this matter? 2. Must the rental proceeds go into a bank account personal to myself (rather than a joint account)? 3. After discovering this thread today, is there any issue with going ahead with this for the previous tax year? Kind regards J

Hi,
As unmarried/ non-civil partners, you may decide the percentage split between yourselves.
In terms of a bank account, this does not need to be considered and is determined by the party who claims both income and expenses of the split.
Although there is no issue with deciding to start with a previous year, we would expect the income to correspond to reality as per the following guidance, and the declarations should reflect this:
TSEM9160 - Ownership and income tax: legal background: ownership - income follows property
Thank you.