Inherited tenanted property - deposit and AST question
Tenancy Deposits

TAE28
TAE28
8 Thanks
45 Posts
3 years ago
0
Having received conflicting expert advice asking experienced landlords who may have been in a similar position their thoughts.

Background: Husband's uncle was in a care home (dementia)and his house rented to help pay the fees. RLA 6 mth AST initially now ongoing monthly. Larger than 5 weeks deposit taken as dog allowed, protected with TDS. Paperwork set up in uncle's name and husband and self POA. Rent went into Uncle's POA bank account. All checks undertaken and notices issued etc.

Sept 2019 uncle sadly died POA ceases and solicitor, executor of will then collects rent. Husband and brother in will to inherit the property which it transpires has never been registered as always been in same family. Solicitors stated 1st registration must be paid for(£800) by husband and brother not estate, but due to covid issues both with solicitors and land registry they say property may not be in their names for another 6 or 7 months. Solicitors have now handed over the rent collected from the date of death and tenants asked to now pay husband and brother from now on. Solicitor states has retained tax due on rental income, but no account taken of expenses incurred.

TDS advise returning deposit and re-protecting as it is a "material change" NRLA do not think necessary (but do not think husband mentioned TDS's position) RNLA said new tenancy agreement not possible at this point as until registered they don't own. NRLA also said solicitor was wrong to give out the rent collected so far and that they should still be receiving rent from tenants.

Question: What TDS and NRLA say and solicitor has done seems to be a conflict. Husband and brother want to continue rental, but ensure it is legal & correct if this changes in future and notice may need issuing. What is the best way forward? Also as husband is self employed how do you go about reporting to HMRC before Jan 21 when legal ownership not likely to be completed and solicitor states won't pay tax until this happens.

Hopefully this is clear, but happy to provide more info if needed, apologies for length of post. Have looked at previous posts but found nothing that matches closely enough

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