Not disclosing tenant income

[E36GUY]

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

[Munter]

There is the rent a room scheme that allows you to have a rental income from the property you live in up a certain ammount. I suspect £800 a month is over than ammount.

I believe you can look up the details of the rent a room tax thing on www.direct.gov.uk

[Munter]

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Ta...

[tigger1]

800 a month is £9600 a year, and he should have paid tax on more than £5000 of that (each year) - so at a guess, 20% of £15...£3k tax bill for your friend?

[FiveStar]

how did he get caught?

[bryan35]

thought it was 6K pa you could from from a tenant.

could be wrong.

[Vesuvius 996]

E36GUY said:

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

1. The HMRC anonymous grass line is a very useful thing if you want to screw someone over.

2. Vaseline is more slippery when you warm it up first.

3. A criminal record makes it very difficult to get a decent job.

4. Next time, pay your fvcking tax like the rest of us have to.

[wasted years]

Vesuvius 996 said:

E36GUY said:

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

1. The HMRC anonymous grass line is a very useful thing if you want to screw someone over.

2. Vaseline is more slippery when you warm it up first.

3. A criminal record makes it very difficult to get a decent job.

4. Next time, pay your fvcking tax like the rest of us have to.

Well said!

[tigger1]

Vesuvius 996 said:

E36GUY said:

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

1. The HMRC anonymous grass line is a very useful thing if you want to screw someone over.

2. Vaseline is more slippery when you warm it up first.

3. A criminal record makes it very difficult to get a decent job.

4. Next time, pay your fvcking tax like the rest of us have to.

Quite possibly one of the disgruntled tenants, upon being forced to move out?

Vesuvius - bit harsh, given it (seemingly) wasn't the OP that wasn't paying tax in this matter!?

Also - isn't non-payment of tax only a civil matter, up to the point of tax evasion?

[nic925nf]

The 'rent a room' scheme permits 'lodger' style income of up to £4250 per tax year (as per Inland Revenue link).

As I understand it you have to be sharing the premises with your tenants, i.e can't use it as an excuse not to declare buy to let income. If it is less than that magic figure I don't think you even have to mention it on your self-assessment form....

However, if you receive more, you pay income tax at your highest marginal rate (normally either 22 or 40%).

I think you can claim allowances e.g wear & tear etc, to bring the excess 'profit' down though....

Slightly off point but, as a mortgage broker, I remember a lender who use to permit a purchaser more money if they were considering having a lodger. They used to add £4250 p.a to the applicants earnings then apply the income multiple. Normally meant an extra £17k borrowing just for ticking a box...can't do that anymore!

All based on memory only guys, might be worth your friend seeing an accountant. The hour of so of his/her time could save more in the long run if the Revenue get stroppy!

[Vesuvius 996]

tigger1 said:

Vesuvius 996 said:

E36GUY said:

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

1. The HMRC anonymous grass line is a very useful thing if you want to screw someone over.

2. Vaseline is more slippery when you warm it up first.

3. A criminal record makes it very difficult to get a decent job.

4. Next time, pay your fvcking tax like the rest of us have to.

Quite possibly one of the disgruntled tenants, upon being forced to move out?

Vesuvius - bit harsh, given it (seemingly) wasn't the OP that wasn't paying tax in this matter!?

Also - isn't non-payment of tax only a civil matter, up to the point of tax evasion?

I reckon one of the tenants grassed him

My ire was directed at the clever bastard friend, who thought he'd just pocket the cash, sir...!!

Oh, and I am sure tha Ken Dodd and Lester Piggot will beg to differ, whilst examining teir ringpieces for stretch marks....

Edited by Vesuvius 996 on Thursday 6th December 18:49

[tigger1]

Vesuvius 996 said:

tigger1 said:

Vesuvius 996 said:

E36GUY said:

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

1. The HMRC anonymous grass line is a very useful thing if you want to screw someone over.

2. Vaseline is more slippery when you warm it up first.

3. A criminal record makes it very difficult to get a decent job.

4. Next time, pay your fvcking tax like the rest of us have to.

Quite possibly one of the disgruntled tenants, upon being forced to move out?

Vesuvius - bit harsh, given it (seemingly) wasn't the OP that wasn't paying tax in this matter!?

Also - isn't non-payment of tax only a civil matter, up to the point of tax evasion?

I reckon one of the tenants grassed him

My ire was directed at the clever bastard friend, who thought he'd just pocket the cash, sir...!!

Oh, and I am sure tha Ken Dodd and Lester Piggot will beg to differ, whilst examining teir ringpieces for stretch marks....

Edited by Vesuvius 996 on Thursday 6th December 18:49

Furry muff - although weren't they but up for evasion, rather than non-payment?

[Red Devil]

nic925nf said:

The 'rent a room' scheme permits 'lodger' style income of up to £4250 per tax year (as per Inland Revenue link).

Yup

nic925nf said:

I think you can claim allowances e.g wear & tear etc, to bring the excess 'profit' down though....

Nope. From the same link quoted above


The principal point to bear in mind is that if you are in the Rent a Room scheme you can't claim any expenses relating to the letting (for example, wear and tear, insurance, repairs, heating and lighting).

[nic925nf]

Well done Red Devil - that'll teach me to read the link, not scan it!

[plasticpig]

Your mate should claim total incompetence at understanding how the tax system works. HMRC generally dont like people who wiggle and make all sort of excuses. It gives the tax man a warm fuzzy glow inside when they find someone who openly admits to stupidity. He will of course be charged intrest on the amount he owes and probably a smallish fine. I take it he dosent fill in a tax return each year?

[crackedfinger]

plasticpig said:

Your mate should claim total incompetence at understanding how the tax system works. HMRC generally dont like people who wiggle and make all sort of excuses. It gives the tax man a warm fuzzy glow inside when they find someone who openly admits to stupidity. He will of course be charged intrest on the amount he owes and probably a smallish fine. I take it he dosent fill in a tax return each year?

Good advice that - I got out of a fine once as I had no idea I was supposed to register somethign by a certian date. My expereince with the Tax lot is that they are pretty good to deal with.

[streaky]

Vesuvius 996 said:

tigger1 said:

Vesuvius 996 said:

E36GUY said:

Dear PH dudes,

Mate of mine bought a house a few years ago with 3 beds. One for himself, I moved into another and we got a 3rd fella in for bedroom 3. Both of us paid matey £400 a month rent. When I moved out he got a replacement tenant with the same arrangement.

Thing is, matey didn't disclose the income from us tenants who he had in the house for best part of 3 years before he got hitched, kicked them out and moved the Mrs in. Now it seems the revenue have caught up with him.

Aside from his being fully apologetic & completely fessing up and paying up whatever bill is due which he intends to do, does PH have any useful extra advise in the matter?

1. The HMRC anonymous grass line is a very useful thing if you want to screw someone over.

2. Vaseline is more slippery when you warm it up first.

3. A criminal record makes it very difficult to get a decent job.

4. Next time, pay your fvcking tax like the rest of us have to.

Quite possibly one of the disgruntled tenants, upon being forced to move out?

Vesuvius - bit harsh, given it (seemingly) wasn't the OP that wasn't paying tax in this matter!?

Also - isn't non-payment of tax only a civil matter, up to the point of tax evasion?

I reckon one of the tenants grassed him

My ire was directed at the clever bastard friend, who thought he'd just pocket the cash, sir...!!

Oh, and I am sure tha Ken Dodd and Lester Piggot will beg to differ, whilst examining teir ringpieces for stretch marks....

Edited by Vesuvius 996 on Thursday 6th December 18:49

Ken Dodd was aquitted, Lester Piggott served a day and a year of a three-year stretch inside - Streaky

[jondude]

Vesuvius 996 said:

[

4. Next time, pay your fvcking tax like the rest of us have to.

You mean the middle classes, people on moderate incomes, I take it?

The rich don't pay taxes, the underclass never have.