Karry G
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238 Posts
Tax that is not deducted at source ie. PAYE is paid in arrears.
When I complete my tax return due on the 31st January 2011, I am actually declaring income from rentals for the period 1st April 2009 to 31st March 2010.
Any profits received from the rental of your property will not be due for declaration to the Revenue until 31st January 2012 and then all you will declare is profit from letting your property from the date of the tenancy to 31st March 2011.
You can deduct from the profits, letting fees, repairs, advertising , property insurance and the cost of any outstanding borrowing or mortgage on the property.
It may be that there is very little actual profit declarable to the Revenue after expenses have been taken off.
Income from property is still un-earned income from an "investment vehicle" .
If you go to HM Revenue & Customs website, you will be able to see what your tax allowance is . I can't tell you because it depends on your age, marital status etc.
If you are not working, it may be of benefit if you declare the income from the property to use your tax free allowances.
However , if you claim Tax Credits, rental income will affect the amount paid and it will also affect any benefits you may receive other than child benefit.
The best thing you could do now, is see a qualified accountant so that you can get the best advice possible before any income is declarable to the revenue in 2012.
We all have unique situations - I can give basic advice as an accountant but you really should invest some money in a couple of hours of good advice from a good accountant from the outset .
