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Original poster

Tax on rental income

12 replies

snapdragongirl · 26/02/2024 17:16

If you jointly own a property with your spouse and rent it out, how is the rental income taxed? DH works and is a higher rate taxpayer. I do not work. Would all rental income be taxed at the higher rate or would half be taxed at higher rate and half at a lower rate (I have no other income)?

OP posts:
PickledPurplePickle · 26/02/2024 17:34

If it’s owned 50:50 then you each need to complete a self assessment tax return annually with half the income and expenses on it

PinkDaffodil2 · 26/02/2024 17:35

If it’s owned jointly then spilt 50:50, though it’s quite straightforward to put the profits all in your name.

Original poster
snapdragongirl · 26/02/2024 17:40

Thank you both for your replies.

So it is possible for me to declare all the income and it just be taxed as mine? And legitimate to do so?

OP posts:
confusedlots · 26/02/2024 17:47

snapdragongirl · 26/02/2024 17:40

Thank you both for your replies.

So it is possible for me to declare all the income and it just be taxed as mine? And legitimate to do so?

Yes this is exactly what we do because DH is a higher rate tax payer

Notstrongandstable · 26/02/2024 17:47

We were in the same boat and got a declaration of trust. I declare the 99% share and he declared the 1%

Original poster
snapdragongirl · 26/02/2024 18:36

Well I'm very pleased to learn this as I actually wondered if it would all be taxed at higher rate because of DH's earnings! Really useful, thanks all Smile

OP posts:
Original poster
snapdragongirl · 26/02/2024 19:59

Thank you!

OP posts:
daisymoo2 · 26/02/2024 22:22

Really helpful advice, thank you. Do I need a lawyer to draw up a deed of variation or can my husband and I draw up an agreement and each sign it? Would that satisfy HMRC?

emark · 26/02/2024 22:27

This depends if the rental property is registered as joint ownership 50:50 with land registry.
It's form 17 HMRC to notify change of split and a deed of variation.
Land registry needs to also be informed.
If only a sole owner a deed of trust giving the beneficial interest to spouse is required.
An accountant who specialises in property is worthwhile as likely other things you can also allow

daisymoo2 · 26/02/2024 22:52

@emark does this require a change in ownership between spouses? I thought the DoV was to reflect a profit share arrangement that differed from share of ownership? Trying to work out whether the hassle is worth the tax saved!

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