Landlord Tax On Rental

[annieigma]

Does anyone know the taxation that a landlord would pay on the income if, for instance, the property was mortgaged and the mortgage payment was equal to the rent charged, with no profit being made?
thank you.

[factor-fiction]

I don't know, but I can see that it could be argued that a profit is being made if capital is being repaid

[Peter Pedant]

yes I do.

The allowable expenses on rent - amongst others
are the INTEREST on a mortgage

so it depends on the mortgage the landlord has taken out

For a repayment mortgage - the firm will give you a form on the anniversary of the date of the mortgage which will quantise the interest and the capital repaid (if any)

onlythe interest is claimable

Even if you think you arent making a profit
that is there is no tax charge
you should stil declare it

simples - PS you are 17 d late for the year ending 4 Apr 2012

[Peter Pedant]

.

but of course there may be other expenses allowable
The industry norm for expenses is 30%

http://www.hmrc.gov.uk/manuals/pimmanual/PIM2000.htm

[DTCwordfan]

Peter is correct - and keep clear records on all other expenditure. If yoiu have separate rentals, keep separate accounts for income and expenditure, it make it easier in front of any tax enquiry.

[boxtops]

Some years back when I rented out a mortgaged flat, I didn't end up paying any tax on the rental income, because I could show that the rental covered the mortgage payment.