nickbearne Posted November 8, 2008 Report Share Posted November 8, 2008 Hi, I am thinking of renting my 1 bed property which I own as beneficial joint tenants with my wife. I pay higher rate tax and my wife basic rate. Does anyone know a way which I can elect she receives the whole rental income and only pay basic rate tax on the income? Link to comment Share on other sites More sharing options...
plym77 Posted November 12, 2008 Report Share Posted November 12, 2008 Hi Nick As a married couple you only have two choices with the rental profits, either 50:50 split, or follow the capital/beneficial ownership proportions. Therefore if you want her to receive the majority of income then you will have to transfer the majority of beneficial ownership to her. For example, if you transfer 99% of the property to her (either by land registry or Declaration of Trust) and follow it up with the appropriate tax declaration then she will be entitled to 99% of the profits. You should note that it is important to follow up a change in the beneficial ownership with the appropriate tax declaration otherwise income/profits are declarable 50:50 irrespective of the ownership proportions. This can of course work beneficially for some couples, for example, a relatively small proportion of a property passing to a spouse can shift 50% of the income/profits. I hope this helps. If you require more specific advice or assistance with your tax return or the appropriate proportions, declarations and tax forms detailed above, contact me on sherena.glanton@target-accountants.com and I would be happy to provide a quote. Kind regards Sherena Glanton CTA Link to comment Share on other sites More sharing options...
nickbearne Posted November 13, 2008 Author Report Share Posted November 13, 2008 Hi Nick As a married couple you only have two choices with the rental profits, either 50:50 split, or follow the capital/beneficial ownership proportions. Therefore if you want her to receive the majority of income then you will have to transfer the majority of beneficial ownership to her. For example, if you transfer 99% of the property to her (either by land registry or Declaration of Trust) and follow it up with the appropriate tax declaration then she will be entitled to 99% of the profits. You should note that it is important to follow up a change in the beneficial ownership with the appropriate tax declaration otherwise income/profits are declarable 50:50 irrespective of the ownership proportions. This can of course work beneficially for some couples, for example, a relatively small proportion of a property passing to a spouse can shift 50% of the income/profits. I hope this helps. If you require more specific advice or assistance with your tax return or the appropriate proportions, declarations and tax forms detailed above, contact me on sherena.glanton@target-accountants.com and I would be happy to provide a quote. Kind regards Sherena Glanton CTA Hi Sherena, thats very helpful, thanks for such a detailed response. Regards Nick Link to comment Share on other sites More sharing options...
plym77 Posted November 17, 2008 Report Share Posted November 17, 2008 no problem, hope it helps Link to comment Share on other sites More sharing options...
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