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Re:Jointly Owned Property

28/03/2019 13:06:48
That's great, thank you and I'm glad we could help.
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Jointly Owned Property

18/04/2019 06:04:47
Hello,
I own a property with a mortgage (sole owner) which was my main residence for a period, but since moving in with my then partner 3 years ago I have rented it out. We got married last year, and I would like to transfer some of the income to her as I am a higher rate tax payer (I own 2 other BTLs also and the restrictions on mortgage interest relief have pushed me into the higher bracket).
I understand that the default income split for joint owners who are married is 50-50 and I am happy with this. So I have 2 questions:
1. If I make a declaration of trust to give say 10% of the beneficial ownership to my wife, is this sufficient for us to be able to split the income for tax purposes?
2. Would this affect my private residence relief for CGT when I come to sell (planning to sell in 2 years or so.)?
Thanks
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Jointly Owned Property

25/04/2019 10:58:06
Hi myself and my wife own a rental property, 10% to me and 90% to her.
She doesn't work so her total income is below £11,000 so I don't think she'll be due to pay any tax, so does she need to complete a Self Assessment form anyway?
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Jointly Owned Property

25/04/2019 11:10:20
Hi,

I am now confused as to the split of income on a property I rent out. I owned the property pre marriage and currently the title deed is solely in my name as is the mortgage. The money however is paid into a joint account. Should the income be split between us? I assume I’d it was only I can claim tax relief on my part of the income against the mortgage interest?

Damian
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Re:Jointly Owned Property

25/04/2019 13:49:35
Hi,

This is a reply to the question from Anonymous on 25/04/2019 at 10:58:06.

If her share is less than £2500 she will not be required to complete a Self-Assessment return.

If her share of the gross income from property exceeds £10,000 irrespective of the amount of expenses to be set off, a Self-Assessment return would be required.

Further guidance on the criteria for the submission of a Self-Assessment return can be found here:

SAM100050

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Jointly Owned Property

25/04/2019 13:54:19
Hi, my husband and I own properties together. I was paying the tax on the income from both of them. He was contacted last year asking him to pay tax on this income as he . He did this but I am yet to receive a refund on the amount I overpaid. Please can you advise how I chase this up? Thanks
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Re:Jointly Owned Property

25/04/2019 14:31:12
Hi Damian,

This is a reply to your question on 25/04/2019 11:10:20.

Normally if the deeds of the property are in your name only then you will be liable for the tax due on the rental income even if this income is paid into a joint bank account.

You will be able to claim relief for the mortgage interest that you pay, this was restricted to 50% in 2018-19.

Further guidance on this can be found here:

Income Tax when you let property: work out your rental income

If you wish the split to be changed you will both need to complete a Form 17 which can be found here:

Declare beneficial interests in joint property and income

Thanks for your question.

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Re:Jointly Owned Property

26/04/2019 11:38:35
Hi,

This is a reply the the question from Anonymous on 18/04/2019 at 06:04:47.

Sorry for the delay in replying.

We have passed your question to our technical team and are awaiting a reply. We will post the reply as soon as able.

Some questions are more involved and take longer to answer.

I have deleted your duplicate question posted today .

Thank you.

This message was edited 1 time. Last update was at 26/04/2019 11:39:48

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Re:Jointly Owned Property

26/04/2019 12:11:27
Hi there,

This is a reply to the question from Anonymous on 25/04/2019 at 13:54:19.

If you have previously declared all of your rental income in your Self Assessment returns and you were only liable for 50% of the tax due because the property is in joint names. You will have to forward to us a request to amend your returns on which you have declared 100% of the rental income.

The earliest year that can be amended is 2015-16.

You do not say whether you have already made this request. If not, you need to forward this in the format shown here:

SAM114045

We have a helpful service which shows how to claim a tax refund here:

Claim a tax refund

Thanks for your question.

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Re:Jointly Owned Property

26/04/2019 16:57:56
Hi,

This is a reply to the question from Anonymous on 18/04/2019 at 06:04:47.

Sorry for the delay in replying.

1. If there is a declaration of trust showing that your wife now has a beneficial interest in the property, this will be sufficient for the income to be then split in the standard 50/50 ratio between you. This would be from the date the declaration is signed.

2. Yes it will affect your private residence relief, however we cannot give specific advice on this until a disposal is actually made and based on the facts at the time.

Thanks for your question.

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Jointly Owned Property

29/04/2019 13:43:21
You answered my question (25/04/2019 13:49:35) but I am confused.
I've understood that if's my wife's income is less than £2500 she doesn't do a SA, if her income is over £10,000 she does do a SA.
However her total income is around £5000 (all from our rental property) which is in-between the 2 answers you've given?
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Re:Jointly Owned Property

30/04/2019 07:19:51
Hi,

Customers must report rental income profits through Self Assessment if their net rental income is £2,500 to £9,999 after deducting allowable expenses -or gross rental income is £10,000 or more before deducting allowable expenses.

You can find more information from the following links at:

Income Tax when you let property: work out your rental income

Check if you need to send a Self Assessment tax return
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Re:Jointly Owned Property

07/05/2019 06:55:48
Hi

My husband and I rent out a couple of properties, jointly owned 50/50.

As we're both standard rate tax payers I've always declared all of the income on my tax return.

However, the changes to allowances mean I'll be pushed into higher rate, so we need to start declaring the income between us.

I'm worried that this will make us liable to fines for not declaring the income "properly" between us previously, even though the tax paid would have been the same?

Also is it too late for my husband to register for the 18/19 tax return?

Thanks,
Maisie
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Re:Jointly Owned Property

07/05/2019 07:34:58
Hi Maisie,

Even if it makes no difference to the amount of tax that would be due, you strictly should have been declaring the rental income 50/50 from the start.

I would suggest that you write to us with the income details for each year so that we can bring both of your tax affairs fully up to date. Both you and your husband should sign the letter and you should quote both your national insurance numbers.

The address to write to is H M Revenue & Customs, PAYE & Self Assessment, BX9 1AS.

Your husband can still register for Self Assessment. He must register for 2018-19 by 5 October 2019.

He can register via the following link:

Register for and file your Self Assessment tax return

If he wishes to file a paper tax return, this has to be received by 31 October 2019. If he files online, he has until 31 January 2020 to submit his return.
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Jointly Owned Property

21/05/2019 11:38:30
??Hi

?We are an unmarried couple that live together and own 2 properties as joint tenants that we rent out.

The rent is my main income as I only work part time and my partner is a higher rate tax payer so, we have agreed that I get 100% of the income as per PIM1030.
Do I just need to attach this agreement to both our tax returns for 2018/2019?

We are planning on getting married ?but, not for a few years. ?I know? when we are married the income will automatically be split 50 50 unless we change? the actual beneficial interest? and complete the form 17?.
Until that point, does my partner? still need to fill out a self assessment? each year as he is not receiving any other income other than from his job?

?Kind regards,

Lisa
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Re:Jointly Owned Property

21/05/2019 14:42:43
Hi,

Thank you for your question.

The Split of property income differs depending on if you are married or not.

Whilst you are not married the income would come under the rules as you have mentioned held at the below link:

Property Income Manual 4010

As stated in this guidance as long as the business is not run as a partnership (you would be completing a partnership tax return for this) you may nominate what percentage of the income goes to each joint owner and included on their own personal tax returns. This is also the case for any losses the business may make.

There is no official form for this and details can be included on the additional information box of the tax return for potential audit purposes.

If your partner does not meet any other self assessment criteria then a self assessment return may not be required.

Once you are married as you have also stated the rules change slightly. The revised rules can be found on the below link and as you have correctly already stated the split will be automatically 50/50 unless form 17 has been completed to amend how the income is split between you.

Please see: Trusts, Settlements and Estates Manual 9800

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