16:23 PM, 28th January 2021, About 8 months ago 25
I have a problem – it sounds like a nice problem. My agent has got me a short term let for 7 months and the tenant wants to pay 7 months rent in advance. The problem is that this tax year I am a 40% taxpayer, but next tax year definitely only a 20% taxpayer.
As I do my accounts on a cash basis I will end up paying 40% tax on all this income in spite of only 2 months of it belonging to this tax year.
My agent suggests just paying me two months rent to start, hanging on to the money, and then paying me each month during the next tax year. (Agent is big national agent who I trust).
However, I feel sure I have read on HMRC website somewhere that if you use an agent to collect your rent then you are deemed to have received the money on the same day that the agent receives the rent from the tenant.
I have searched without success for over an hour on the internet for this topic on the HMRC website which spells this out very clearly. Can anyone advise me on this topic please and/or give a link to HMRC web page?
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