Inland Revenue Vs accountant

[JDO]

:confused: My wife and myself own three btl properties.

The rental income is paid direct to my wife into a seperate business bank account. I receive no income from the rent.

I recently spoke to the inland revenue who informed me that the rental income is regarded by the IR as joint income and therefore my wife and myself would be taxed jointly. (I am a high rate tax payer hence my wife receiving the rental income)

I spoke to my accountant who informed me that the person from the IR I spoke to is wrong!...and that my wife only is liable to pay tax on the rental income.

I am now confused, can anyone clarify the situaution?

Any comments would be appreciated.

Regards
John

[P.Pilcher]

Regrettably, you have stated that both you and your wife jointly own the BTL properties. Hence in the absence of any mechanism to the contrary the I.R. will consider the nett rental income to be split 50:50 between you and your wife, hence the tax situation is as stated. I suggest that you obtain appropriate professional advice as to your best course of action under the circumstances.

P.P.

[JDO]

I forgot to mention in my initial posting ...the properties are owned as tenants in common with my wife owning 99% and myself 1% of each property.

Rgds

John

[Tax Accountant]

You need to complete the Inland Revenue Tax form (I believe IR15) and notify the tax office of the correct shares owned by each person.

You would have completed your tax returns and declared rental income 99% / 1%. Normally Inland Revenue would accept this.

Ramnik

[JDO]

Thank you both for your replies.

The actual form to be filled in is 'form 17' available from the HMRC web site.

Rgds

John

[Tax Accountant]

You are welcome.

Ramnik