Registering for self assessment – help needed for a newbie landlord

Registering for self assessment – help needed for a newbie landlord

9:48 AM, 2nd October 2014, About 10 years ago 25

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Would appreciate any help the forum could give me on the following …

After searching google and searching your forums I am still none the wiser will regards to self assessment. Registering for self assessment - help needed for a newbie landlord

My wife and I bought our first rental property in January this year and first rented it out in March, we always knew we would need to register for income tax from our rental income but now the time has come are unsure how to.

The HMRC self assessment website does not seem to specifically mention registering as a landlord, so what catergory do we/ I register under?

Also do we both have to register as the property is jointly owned? In which case do we have to split all income and expenditure 50/50

Your help would be greatly appreciated.

Many thanks

Damian


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Comments

AnthonyJames

16:31 PM, 4th October 2014, About 10 years ago

Damien - sole trader, partnerships etc - there's no need to 'register' for anything if you are conventionally employed: property income and expenditure on something as minor as a single rented property is just treated as extra personal investment income. However if either of you are self-employed, have other business interests, are directors of a limited company, or anything more complex, then you need to speak with an accountant.

Damien B

16:37 PM, 4th October 2014, About 10 years ago

Reply to the comment left by "Tony Atkins" at "04/10/2014 - 16:31":

Tony, I am in no position to argue with you but if we do not register for self assessment under one of the categories mentioned then how exactly do we declare the additional income for tax? (This is a question not a statement.)

Thanks

Jason Holden

17:21 PM, 4th October 2014, About 10 years ago

Hi Damian

If you are not under self assessment then you absolutely need to register with HMRC, but you are not a sole trader nor a partnership, you will complete land and property pages.

Hope that helps.

Jason

AnthonyJames

17:56 PM, 4th October 2014, About 10 years ago

Reply to the comment left by "Jason Holden" at "04/10/2014 - 17:21":

Sorry, I took it as read that Damien and his wife would be registering for self-assessment. I just meant there's no special category like "sole trader" for such registration. Jason is correct: you just need the Property pages.

Damien B

19:01 PM, 4th October 2014, About 10 years ago

Jason, when we follow your link to registering these are the only options...

How to register
How you register depends on your circumstances.

Your circumstance Your reason for registering How to register
New sole trader You’ve not registered before Sole trader - register for Self Assessment
Existing sole trader You’ve registered before and need to re-register (eg you’re starting self-employment again) Existing sole trader - register for Self Assessment
Partnerships You’re the nominated partner and you need to register both yourself and the business partnership Partnership - register for Self Assessment using form SA400
Partner You’re joining a business partnership Partner - register for Self Assessment using form SA401
Partner non-individual You’re registering a partner that’s joining a business partnership and they’re not an individual (eg a company or trust) Partner non-individual - register for Self Assessment
Any other reason Eg you’re a new company director, you or your partner get Child Benefit and your income is over £50,000, you owe tax from investment profits, etc

Which option do we choose? Sorry if this seems drawn out but I feel I must be missing something obvious here.

Thanks

Puzzler

8:52 AM, 5th October 2014, About 10 years ago

Reply to the comment left by "Damien B" at "04/10/2014 - 19:01":

Why not phone HMRC enquiry line? They can be very helpful.

Also

http://www.hmrc.gov.uk/agents/toolkits/property-rental.pdf

Michael Barnes

22:29 PM, 5th October 2014, About 10 years ago

Reply to the comment left by "Damien B" at "04/10/2014 - 19:01":

select "Any other reason Eg you’re a new company director, you or your partner get Child Benefit and your income is over £50,000, you owe tax from investment profits, etc"; it is tax from investment profits (or in your case, probably a loss to carry forward).

When you fill in online, you tick "income from property" and get the necessary pages to fill in. If you use paper, then you will need to ask for propeerty pages.

I can't remember if you need a separate registration to fill in on line.

Michael Barnes

22:32 PM, 5th October 2014, About 10 years ago

Reply to the comment left by "Neil Robb" at "04/10/2014 - 13:55":

I believe that legal costs for buying the property are not deductable as revenue expense, but are capital expense and therefore deducted from profit (or loss) when you sell, and therefore affect Capital Gains Tax.

Neil Robb

17:12 PM, 6th October 2014, About 10 years ago

Hi Michael

Yes you are right the initial cost are capital expenditure. Therefore can not be claimed.
I often buy properties for cash then re mortgage them, other cost like a lease agreements from a solicitor etc can be claimed.

Jessie Jones

15:09 PM, 27th November 2014, About 9 years ago

Reply to the comment left by "Michael Barnes" at "05/10/2014 - 22:32":

"I believe that legal costs for buying the property are not deductable as revenue expense"

I am trying to prepare my accounts for the first time and am unsure about what expenses (if any) relating to the purchase of a property are deductable as a revenue expense.

Does anyone have a definitive answer regarding whether any of the following relating to the purchase of the property are deductable:
1. Mortgage arrangement fee
2. Valuation fee / homebuyers report / structural survey / flood risk reports
3. Mortgage brokers fees
4. Conveyancing / solicitors fees
5. Mining / Local Authority etc searches
6. Chancel Indemnity insurance
7. Telegraphic transfer fees,

or is it the case that all of these are just part of the initial investment costs that are deductable from the sale price when working out Capital Gains?

I know I should use an accountant but I'm not making enough profit yet to pay one !

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