If you own an investment property or properties, and you rent these out then you will need to complete accounts for your rental business, and also personal tax returns. Melior can help with this.
The first £1,000 of your income from property rental is tax-free. This is your ‘property allowance’. You may be able to avoid tax returns if your income from property rental is between £1,000 and £2,500 a year.
You must report it on a Self Assessment tax return if it’s:
- £2,500 to £9,999 after allowable expenses
- £10,000 or more before allowable expenses
If you do not usually send a tax return, you need to register by 5 October following the tax year you had rental income and we can help you with this.
We can also provide help to Non-Resident Landlords, with the UK tax reporting requirements they will need to make.
- A Non-Resident Landlord is a person who has UK rental income and whose ‘usual place of abode’ is outside of the UK.
- Individuals who are outside of the UK temporarily (less than six months) are not Non-Residential Landlords.
- In cases where properties are jointly owned, each individual is liable to pay tax. Both the income and the expenditure is split equally between the two parties.
- Non-Resident Landlords include members of the HM armed forces and other Crown Servants who are outside of the UK for over 6 months.
- When a Non-Resident Landlord receives rent direct from the tenant, the tenant has a statutory obligation to deduct 20% of the net income and make payments to the Inland Revenue on a quarterly basis.
- Non-Resident Landlords can apply to the Inland Revenue for approval that will permit their letting agent not to deduct tax at source and we can help with this. However, approval does not mean that the rent is exempt from UK tax.