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AIBU?

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Original poster

Aibu most people don't know rental income is taxable?

158 replies

sicknessmedi · 23/10/2025 22:42

Most people don't realize that if you have a second home and rent it out, you have to declare rental income as income and pay tax?

OP posts:
BadgernTheGarden · 24/10/2025 09:22

DisappointingBrownie · 24/10/2025 09:06

I can’t imagine not knowing and we have rented a flat out for 20 years. We pay tax of course. With all the new rules coming, we are trying to sell up currently.
My friend rents out two houses and hasn’t told HMRC. Has lots of nice holidays on the passive income!

Dob them in, they are robbing all of us.

BadgernTheGarden · 24/10/2025 09:18

All income is taxable (earned or from savings/investments) if it's over tax free allowances and not in an ISA, I think everyone knows this, they might chose to play ignorant though and hope the tax man doesn't catch them, saying you didn't know won't play well if they do.

mysoulmio · 24/10/2025 09:17

Yes, it's very clearly stated on the self assessment form. But I guess if you've never done self assessment and are very uneducated you might not realise that all earned income is taxable.

Irenesortof · 24/10/2025 09:14

This is about not understanding tax, not about being confused about landlording. I guess these people are on PAYE and don’t fill in a tax return. They’d know if they did.

somethingandnothing · 24/10/2025 09:08

Of course people know this. You'd have to be ridiculously thick not to know.

DisappointingBrownie · 24/10/2025 09:06

I can’t imagine not knowing and we have rented a flat out for 20 years. We pay tax of course. With all the new rules coming, we are trying to sell up currently.
My friend rents out two houses and hasn’t told HMRC. Has lots of nice holidays on the passive income!

ApplebyArrows · 24/10/2025 09:01

Whilst I am sure a lot of landlords who claim not to know about this are going to be liars, we need to acknowledge that some landlords are just very thick. Contrary to the popular attitude of the sorts of people who come on Mumsnet, owning property does not in fact prove you to be intelligent.

Original poster
sicknessmedi · 24/10/2025 08:53

Soporalt · 24/10/2025 08:47

I’ve seen this a lot in my voluntary role. Usually it’s inherited property or a “spare” property when a couple move in together. They say they didn’t know, but I don’t always believe them. HMRC finds out when people own properties that are not their home address, and vice versa, and via returns from agents. HMRC can usually go back 20 years and charge pretty heavy penalties and interest. But to correct one thing in prior posts, although HMRC says you should notify it and submit tax returns where the income is over £1k (I think rising to £3k), if you have no liability because it’s covered by your personal allowance there is no requirement in law to submit a return unless you’re issued with one and no penalties it can charge.

Thank you

OP posts:
Original poster
sicknessmedi · 24/10/2025 08:53

littlebilliie · 24/10/2025 08:39

I thought that too, shall we go on a new subject. Some people think the earth is flat 😂

Show quote history

You should actually read the replies

OP posts:
Soporalt · 24/10/2025 08:47

I’ve seen this a lot in my voluntary role. Usually it’s inherited property or a “spare” property when a couple move in together. They say they didn’t know, but I don’t always believe them. HMRC finds out when people own properties that are not their home address, and vice versa, and via returns from agents. HMRC can usually go back 20 years and charge pretty heavy penalties and interest. But to correct one thing in prior posts, although HMRC says you should notify it and submit tax returns where the income is over £1k (I think rising to £3k), if you have no liability because it’s covered by your personal allowance there is no requirement in law to submit a return unless you’re issued with one and no penalties it can charge.

littlebilliie · 24/10/2025 08:39

Merryoldgoat · 23/10/2025 22:45

Quite. What’s the point of the thread?

Show quote history

I thought that too, shall we go on a new subject. Some people think the earth is flat 😂

Pharazon · 24/10/2025 08:35

Anyone who understands the concept of 'income' and 'tax' knows this.

whirlyhead · 24/10/2025 08:34

Everyone I know knows this! I do know someone who has had rental properties for about 20 years now and has never once declared them to HMRC. I rather hope it bites him in the bum one day.

I declare everything religiously and always have and pay the required tax out of my own pocket as none of my properties make money and never have.

Member984815 · 24/10/2025 08:30

I'm a landlord, I rent out my old family home and everyone knows you must pay tax on your earnings . People who don't are avoiding tax on purpose.

Viviennemary · 24/10/2025 08:29

Of course people know this but they might choose to pretend they don't or ignore it.

TheNightingalesStarling · 24/10/2025 08:29

KnickerlessParsons · 24/10/2025 08:27

It’s only taxable if it takes you over the tax paying threshold, which is about £12.5k pa I think.
so if it’s your only income and is less than that, you don’t pay tax on it.

But I think the majority of people know that they have to pay tax on income.

But you still need to declare it officially.

KnickerlessParsons · 24/10/2025 08:27

It’s only taxable if it takes you over the tax paying threshold, which is about £12.5k pa I think.
so if it’s your only income and is less than that, you don’t pay tax on it.

But I think the majority of people know that they have to pay tax on income.

NoSoapJustUseShowerGel · 24/10/2025 08:25

sicknessmedi · 23/10/2025 22:44

I have spoken to many people and they don't know

(Edited question already answered)

Chazbots · 24/10/2025 08:21

I get emails from HMRC about tax on rental income a lot. I also pay the tax.

That said, my Sil never declared her property income. I judged her accordingly.

Windypopswoo · 24/10/2025 08:20

I had a flat in my early 30s that I rented out as I moved for work. I then rented a place myself.

I genuinely didn't know I had to pay tax on my rental income.

I found out through a casual conversation with a friend after I had sold the flat a few years later.

I looked into it immediately, realised I was within the 7 years in which I needed to declare it to HMRC and did so. They had a campaign at the time to help people in my position (can't remember it's name now). I declared it all, paid the fines, paid the tax.

No idea about other people but yes, it happens.

tilypu · 24/10/2025 08:17

I would be very surprised if many of the people that need to know this, don't.

I'm pretty sure there is a lot of tax/vat laws that people aren't aware of - but it doesn't matter because they don't need to be.

RedRiverShore5 · 24/10/2025 08:16

Has OP just generally asked around generally about this, bit like if I was asked about Non Dom tax and didn't know because I wasn't one anyway.

viques · 24/10/2025 08:10

Garamousalata · 23/10/2025 22:58

There’s capital gains tax to be as well.

And insurance. And making sure safety certificates are up to date…….

So pleased this thread will be passed around all the OPs landlord friends to help and educate them .

RedRiverShore5 · 24/10/2025 08:09

But are the many people that don't know got a property they need to pay tax on anyway, if they haven't it doesn't matter. Do you really know that many people with rental properties

Edinburghdaze · 24/10/2025 08:03

MannersAreAll · 23/10/2025 22:59

I've spoken to a guy with investment property and he didn't know.

Of course he knows.

Quite a lot of people think claiming they didn't know is a defence that will be accepted so bullshit they don't know.

This.