Second property

[Dasch]

Hi does and no the rules to child and working tax credits if my second property has been let rent free to adult son

Why would you be in receipt of any kind of benefits if you own two properties?

Your aloud to have property’s and claim child and working tax credits my point is do have to charge rent

Capital doesn't count for tax credits only rental income minus allowable expenses. This would come under other income. Have you not been switched to UC yet?

I am not on any benefits now I came across something for child and working tax about deprivation of income which I didn’t know about and wether I should of told them about the second property

Not if you weren't charging rent. Capital or capital gains had no effect on tax credits

Did I have a legal duty to disclose the second property even though I don’t receive rental income

Can anyone help me please

Yes, because there are limits on assets and capital for some income related benefits. Presumably ds did not claim any help with rent etc.

You shoukd just inform UC you have a second property and see what they say. If you don't you are risking getting in a difficult position.

I wasn’t claiming UC it was child and working tax credits

Those predated uc but were still subject to means testing. There will have been questions about income and assets when you claimed them.

The capital rules i Tax Credits were very different.

You declare the income received, in this case none

I’ve been told by my friend that child and working tax credits would of expected me to take rent and that I can be treated as having income even if I did not receive it when I’ve looked I’ve seen notional income apparently it’s to stop people manipulating the system to gain more tax credits then I would of been entitled to comes under tax avoidance I’m so confused with it all and out my mind and so scared I’m in deep trouble

If you didn't charge rent then you didn't have income to declare. Assets weren't taken into account for tax credits, only taxable income. I can't see that you would have been expected to charge a child rent

my son is a adult and at the time he had not long been in employment and so couldn’t get his own mortgage we bought the house 2012 with the understanding that he would then take out his own mortgage my brother gifted me the deposit to but down on the house for my son but with one thing and other we dealt with a lot family problems and it never happened so I just carried on paying the mortgage and it’s only now he’s tuck out a bank loan paid off the mortgage and we have come across capital gains which we didn’t have a clue about this

So you would be liable for cgt if you never lived on the house and have transferred it at an increased value to when you bought it. There are annual allowances to offset the gains, you need legal advice but that should have been raised when he took out the loan. That is a different issue to tax credits though.

Yes you should have declared you have a second property even though you receive no income from it. It’s still an asset

Not an asset for tax credits. It is for uc, as would cgt be if it was sold whilst claiming tc

can I please ask that only people who know about childcare working tax credits to comment I’m not been in rude its just confusing me even more it’s just not about UC I’ve never claimed UC ever

This is what needs to be included for tc op

Include:
Income from paid work or self employment
income from property and shares (unless rented out under the Share-a-Room scheme)
income from occupational and other private pensions
income from the state Retirement Pension (including the basic state pension, State Earnings-Related Pensions (SERPS) and Graduated pension/retirement benefit, but excluding the Christmas Bonus and Winter Fuel payment)
interest and dividends on savings and investments (except tax-exempt savings plans such as ISAs, PEPs and non-taxable National Savings products)
foreign income (including overseas pensions and social security benefits)
any shares purchased from an employer under a Share Incentive Plan
Dependant’s Grant paid to students with a spouse or unmarried partner or dependant adult

I still don’t know because it says income from property rented out but it wasn’t I’ve not charged any rent

If you didn't get any income from rent then there is no income to declare

I really appreciate your reply but what about depriving yourself of income to increase your entitlement to child and working tax credits

This is what I have seen

Deprivation of income would be for example you charging rent but the tenant paying it to a third party to hide it.

If you didn't charge rent you had no other taxable income from the property.

Did you ever charge rent and then stop? I can see how that might be viewed as deprivation but otherwise I can't see that it would be classed as notional income because it was never there in the first place.