Tax on rental income
Discussion
My aunt sadly died. My mother is executor of the will, which is complex.
My late aunt's house is now being let out, and the rental income is going towards solicitor's fees to sort out the estate. I assume income tax is payable on the rental income, by the estate.
How is this calculated and paid? Does the estate have a tax-free allowance as a person would have?
My late aunt's house is now being let out, and the rental income is going towards solicitor's fees to sort out the estate. I assume income tax is payable on the rental income, by the estate.
How is this calculated and paid? Does the estate have a tax-free allowance as a person would have?
Thanks Eric. Probate has been granted as far as I know, but there is a complication in that part of the property (an upstairs flat) is in the son's name, although with no "beneficial interest" and there is likely to be lots of tax to pay for rental income from when my late Aunt was alive
Estate goes to the grandson, to be held in trust until he is 21.
Kam
Estate goes to the grandson, to be held in trust until he is 21.
Kam
The executors will be responsible for completing any outstanding tax returns that the aunt should have completed. They will also be responsible for paying over any unpaid taxes ()including penalties and interest if appropriate). Any such taxes would be paid from the resources of the estate.
Once the property has been handed over to the beneficiary, from that date onwards, any rental income belongs to the beneficiary and it will be their responsibility to return rental income and pay the relevant taxes.
Once the property has been handed over to the beneficiary, from that date onwards, any rental income belongs to the beneficiary and it will be their responsibility to return rental income and pay the relevant taxes.
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