Quote:
Originally Posted by macafee2
because I'm not making any money out of it. To keep repayments down it is an interest only mortgage.
most landlords make money or get the mortgage paid so in "25" years the house is mortgage free and it cost them nothing. "Emily" cant afford to cover a repayment mortgage so until Emily dies we wont make money. Once she dies we could rent for a price in-line with other properties.
When it comes to repairs, there is little in the kitty. My wife was going to have the boiler changed but not if we have to pay out £900, as there wont be enough in the kitty.
ho hum
macafee2
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Ian - this is not intended to be an argument but is intended to help you see the situation clearly (at least how I see it, but I am not a tax or local government expert!).
From what you have written, I would say that what you are doing is exactly the same as any other landlord. You have bought a property (in your name) that is being rented out to a third party and is appreciating in value. The third party is paying you rent in the form of a payment into your mortgage account plus an amount that is "put aside" by you for repairs. You should therefore be complying with all the local authority licensing requirements and paying tax on the rented property in accordance with the current "buy to let" tax regime. There are tax allowances available for certain repairs which can be deducted from the market rent for tax purposes.
I would suggest that you need advice from a tax advisor.