Rental Income for couple owing property jointly

hsodhih

If a couple had a mortage on their own accomodation, then they remortage this accomodation to buy new house that has now become their main residence and let the old property.

My question being that they owned the old house jointly, so would they get double capital gains tax relief?

Also will the rental income from old house now need to de declared as a split between husband, wife? Will this need to be as a partnership or just a split of income.

Husband is already self employed so will the wife have to notify the Inland Revenue of rental income commencing? And how does she do this?

Thanks in advance.

jilt

Can't help with the CGT releif myself without looking it up but regarding the rental income, if the property which is let is jointly owned then yes any profits will have to be split between them and they will both need to file a tax return.

They do not need to form a partnership simply divide the profits, or loss. The wife will have to contact HMRC to explain that she is receiving rental income, but she must not say she is self employed because she isn't, rental income is not classed as a trade, so no home office can be claimed for. My client did this and was paying class 2 NI but I wrote to HMRC and he was refunded any class 2 he had paid.

Jmann

hsodhih wrote: »

My question being that they owned the old house jointly, so would they get double capital gains tax relief?

Both entitled to thier annual exemptions

The couple will recieved two Letting relief of £40,000 (maximum).

As long the old house was their PPR and they lived in the house before renting it out.

deanshepherd

I'm struggling to see where capital gains tax, PPR and lettings relief are relevant.

Has any property been sold?

T.C.

Surely capital gains tax when it sells only. In the meantime the profits/losses should be shared in the individual tax returns - land and property pages!