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

[sicknessmedi]

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?

I'm pretty the ast majority of landlords know this, and all their other legal obligations

Probably the people who do this, know this. I can't imagine anyone else cares tbh

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

Although of course once anyone stops to think about it it's entirely logical and right that you would pay tax on rental income... What am I missing here? Why is this news?

Quite. What’s the point of the thread?

Do you gatekeep the posts? You don't need to post

No I would think actually most people in receipt of rental income are more than aware of their obligations. I suspect if they claim otherwise they just don’t want to pay their tax.

People who are landlords or just general people? If someone isn’t renting out a property what difference does it make if they know or not?

Do you mean that the average Joe doesn’t know often doesn’t know this? If so, I agree. I see so many comments on Facebook posts (where houses are advertised for rent) about how greedy landlords are etc., and many don’t understand the costs involved.

To be honest, before my DP moved in with me and we put his up for rental, I didn’t know you had to. By the time he pays 20% tax, the estate agent fee of 13%, his landlord’s insurance and boiler insurance, his mortgage is only just covered. Which is great that it is covered, it basically takes care of itself, but he’s certainly not rolling around in it like many think (though I fully appreciate he has an asset there which is increasing in value, not at his cost).

Those that don't know this are, most likely pretty crap landlords I would imagine.

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

‘Many people’ certainly might not know. But if someone actually owns a second property and rents it out they will almost certainly be aware.

They are very thick if they actually don't know that we generally pay tax on our income. Probably more likely that they were hoping to get away with it.

There’s capital gains tax to be as well.

HMRC don't accept stupidity as a reason for not paying your tax.

This :/

Surely most people know they have to pay income tax on, erm, income?

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.

What, you mean we have to pay tax in this country? Why didn't anybody tell me?

Of course, if his property is his only income, he may be within the Personal Allowance and owe no tax.

But youvstull have to do the Self Assessment tax form to show you owe no tax. And can be fined for failing to tell them you owe no tax.

Is that meant to be some sort of surprise? Of course it's taxable, it's income. Just like the insurances/expenses are tax deductible.

So the tax paid is on the income minus the expenses.

Why have you spoken to many people about this? I'm nearly 60 and this subject has never cropped even once in my conversation in all that time.

I’m a landlord and know this as does my accountant sadly

Everyone with a rental property knows this.

Most people do know that.

Yeah, I suspect most who have rental income are very well aware it's taxable but some choose not to declare it as "how will Hmrc find out?". Until of course Hmrc do in fact find out.

ignorance isn't a defence