Where do i start with self assessment?

[ivrytwr3]

Purchased a house in Jan 06, tenants in Mar 06 for 6 months, empty for 1 month and new tenant still there. The rent the tenant pays does not cover the mortgage (we're hopefully in for the long haul!). The property is owned jointly with my wife and i. And so a couple of questions:

1. Do we need to fill in self assessment forms? (both, just me, or neither?)

2. When do we need to fill one in?

3. How do we go about getting these forms and do we need to ask for anything extra?

4. How long does it take you to fill in?

5. Any hints/tips on filling in these things?

6. Is it worth employing someone to complete them for you?

Ta all!!

[Tax Accountant]

Purchased a house in Jan 06, tenants in Mar 06 for 6 months, empty for 1 month and new tenant still there. The rent the tenant pays does not cover the mortgage (we're hopefully in for the long haul!). The property is owned jointly with my wife and i. And so a couple of questions:

1. Do we need to fill in self assessment forms? (both, just me, or neither?)

Yes, both.

2. When do we need to fill one in?

From commencement in January 2006 to 5 April 2006 (or upto 31 March 2006 if this is easier) falls in the tax year 2005-06. Latest filing and payment due date is 31 January 2007.

3. How do we go about getting these forms and do we need to ask for anything extra?

Contact your tax offices to notify chargeability and issue of self assessment tax forms. However, you are likely to have made a loss due to loan interest commencing in January but rental income not commencing until March. If you prepare income and expenses account showing the losses (available to carry forward to next year), and send this to your tax offices with a covering letter, they may give you dispensation from filing self assessment returns in view of the losses.

4. How long does it take you to fill in?

You need to complete the general form as well as supplementary pages for employment and income from property. No more than 10 minutes.
5. Any hints/tips on filling in these things?

You need to know which expenses are allowable and to claim these.
6. Is it worth employing someone to complete them for you?

Depends on you. If you are prepared to do the research, there is no need to employ an accountant at this stage. I would imagine that an accountant may charge between £100 and £200 +VAT to deal with this.

Ta all!!

See answers above in red.

Ramnik

[ivrytwr3]

Ramnik,

Thankyou for the detailed reply. One last question before i make the call to my tax office, i am in HM Forces (which is the reason i let the property, as i am now living in HM Forces accommodtaion), can this benefit me in anyway?

[Tax Accountant]

Ramnik,

Thankyou for the detailed reply. One last question before i make the call to my tax office, i am in HM Forces (which is the reason i let the property, as i am now living in HM Forces accommodtaion), can this benefit me in anyway?

Yes.

So long you have a clear intention to occupy the property as your main residence as soon as you are able to do so (ie if and when you leave the forces), you will be deemed to have occupied the property as such and therefore qualify for PPR relief.

This applies notwithstanding that the property is let in the meantime and that you have never actually occupied the property as your home.

It is preferable to notify this intention to your tax office in writing and obtain their acknowledgement.

This can only apply provided neither you nor your wife have any other property qualifying as such at the same time. Remember, a married couple can have only one property between them which benefits from PPR relief.

The above position ceases as soon as your intention to occupy it as your main residence ceases. This can happen, for example, if you buy another property and intend for this other property to be occupied as your main residence. In that event, this other property starts so qualifying.

I hope this helps.

Ramnik