If rental income was you only income would you be taxed ?

[SimonV8ster]

If you rented out your house but lived elsewhere would the rental received be taxed if you weren't earning elsewhere ?

What if you were working elsewhere, would it be taxed then ?

[LC23]

You should bear in mind that it's only the rental profit that is taxable. So you would need to offset all allowable expenditure before you consider whether there is any income to (potentially) be subject to tax.

[Welshbeef]

You still have your personal allowence

secondly let's say your home has a £50k mortgage on it but you could extend your buy to let mortgage by £50k so your total borrowings would be the same BUT if before you were making a profit then this way you may well be breaking even or loss making so no tax to pay. Physically you'd be better off by the way the debt was structured.

You could also simply extend the buy to let mortgage and have the cash sat in your savings account you'd earn a little interest and ideally make a loss or break even so again be better off tax wise and clearly the tax saved can be used for extra savings or to pay off more of your home mortgage.

If say you were married and both earning and after all expenses your still making a profit make sure whoever is on the lowest tax rate records the rental profit as you may be on 40% and your wife on 20% therefore put it through her name and legally halve your tax burden

[Eric Mc]

Splitting the rental income between spouses is feasible but for it to work both parties should be the owners of the proprty i.e. it should be in joint names.
The split is normally evenly divided between the joint owners. I don't see how it could be split any other way.

Rental profits are taxable under the rules pertaining to rental income. These used to be known as the Schedule A rules.
Rental incvome is looked on as Investment Income rather than Earned Income and is therefore not subject to National Insurance.

If the rerntal property makes losses, the losses can only be carried forward against rental income in future years.

Rental income from UK Holiday Lets is treated very differently. It is handled much like the income from a business and there is a more flexible set of rules regarding how losses can be utilised. However, profits from Holiday Lets are still not subject to NI.
There were plans to bring Holiday Lets into line with normal Lettiongs but this has now been scrapped.

If you rent out your home for more than three years, when you eventually sell it, there could be a Capital Gains Tax charge arising.

Under the CGT rules, Holiday Lets are eligible for the special 10% Business Asset CGT rate. Ordinary lets will be taxed at 18% or 28%.