HMRC Admin 20 Response

Hi tnguyen129,
The information given by the Solicitor regarding no change to deed or mortgage is correct.
We are unable to answer your question regarding Stamp Duty and therefore advise you to contact the Stamp Duty helpline on 0300 200 3510
who will be able to answer your query in further detail.
Thank you.

Hi Mauree n Treadwell,
As per PIM3010, capital allowances may be claimed on the purchase of small tools providing they are used wholly and exclusively for the rental business as revenue expenditure within box 29 “other allowable property expenses”. PIM3010 - Capital allowances.
Thank you.

 

Hi Wemthaw,
From my understanding of your question, as per the guidance attached, unused finance costs may be carried forward to the following tax year
if they were unable to be used in the year of incurrence.
Tax relief for residential landlords: how it's worked out Example 4: carrying forward unused finance costs.
Thank you.

 

Hi soconfused,
When completing the 2023/2024 Tax Return, the previous years losses would not automatically be carried forward, so a record of any losses from previous years is advised to remain up to date with any available losses until a profit is made.
I would also suggest logging any unused residential property finance costs as the same applies and this needs to inserted manually in box 45 of the SA105 property supplementary page. Thank you.

Hi samuels,
In your situation, it would be advisable to send a copy of the declaration to HMRC so both records may be updated with the relevant percentage split of ownership.
Upon any further changes, please be aware that an amendment to the declaration would be expected.
Thank you.

Hi Matthew Clubb,
The USA can tax you.  
You declare your USA rental income on a Foreign Earnings page SA106.  
You can also declare the tax that you have already paid there.  
We can take that tax into account in your final tax calculation.
Thnak you.

 

Hi Jimssen,
From my understanding of your question and the attached adjusted net income guidance, following step 1- work out your ‘net income’, this section would include your Gross rental income, i.e. total rents and other income from property, then deducting any insurance, repairs, legal & management costs etc.
When looking at the tax relief for residential property finance costs, this is dealt with separately from other expenses incurred.
In the example that you are in a position where a profit has been made on rental income and have exceeded the personal allowance where residential property finance costs incurred are £200, the relief due would be 20% of the finance costs, so in this case would be £40. This would then be included in the net rental profit figure.
Thank you.

 

Hi Filbert79,
You can go to a solicitor to divide up the legal ownership of the property in four ways and ask for advice about selling it.  
You could then split the gross rental income in four ways.  
You could keep the split at 50-50, pay the tax due on your 50% share & then divide the net income up how you like.  
Don’t forget if you sell this property & you are not due any private residence relief there could be capital gains tax owing on
your share, that is if it has gone up in value since you inherited it. 
Thank you.
 

Hi CheddarCat,
No amend your 2021-22 return online before 31/01/2024 to include the residential finance costs in box 44. 
Thank you.

 

Hi CheddarCat,
No because the mortgage interest is not an additional cost.  
You were paying that mortgage before you got the lodger in.  
The finer details of the rent a room scheme can be found at PIM4000 - Rent-a-room: contents.
Thank you.