Good morning everyone,
I am new here, not sure if this is the right place to put this post so please accept my apoologies if I have got this wrong and feel free to move it.
So, my ex and I are divorced, and have been for some time now. After our divorce, I bought my own house which is purely in my name and nothing to do with them.
I have been paying child maintaince for the past 4 years or so after my daughter went to go live with her father full time as it was her wish.
I have recently moved in with my new partner, we have been together over 5 years now, and renting out my house whilst we trial living together.
I received a notice of variation from CMS stating that they cannot find any record of me renting the house out with HMRC and can I confirm it with them for payment purposes.
My understanding was that, like tax, you only declare the profit that you earn. My research is less certain with CMS. The rental I receive is £1000 a month, however that goes straight into the mortgage which is £1050 so I am making a loss each month and topping the remaining £50 myself each month.
I am making no profit from renting the house out from the rental income.
My question is therefore this - how would CMS see this? Do they see the entire rental income as income even though it is paying straight into the mortgage and I am making a financial loss each month from the rental or is it only profit from the rental income that they would take into account?