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Buy to let property am i doing things right??

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dee2912 | 00:55 Fri 30th Dec 2011 | Business & Finance
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Hi I have a but to let property and have a management company running it any money I make from rental gets paid into my bank should I be taxed on it? its just one property its not a business as such to me its in negative equity so I am still loosen money when I DO get a tenant and receive rental income.

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I didn't get taxed on it when I let my flat via a management company - the cost of the rent was offset against the monthly mortgage payment.
But you'd need to do a tax return to come to that conclusion wouldn't you boxy?
http://www.direct.gov...ntalIncome/DG_4017814

The above link is very helpful, you set the income against permissable expenses which includes the interest on any mortgage, but will have to pay tax on any profit.
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Hi boxtops, I haven't been asked by anyone just don't want any nasty surprises, I done a check on moneysavingexpert to check if I were due a tax rebate and i found this wondered if it applied to me because i own a buy to let:

Step 2: Check for deductions.

There are often legitimate reasons why there is a difference between the tax free allowance and you tax code - the main (but not only) ones are below.
You have a company car
You get other employee benefits (eg, medical insurance) - see detailed list
This is a tax code for a 2nd (or 3rd etc) job
You own a buy to let property
Those items count as benefit in kind or similar (our tax codes change if we get lease cars for instance, as there is benefit from having the car) so I suspect you'd need to fill in the unearned income part of a tax return (I used to fill one in in those days), so the position could be determined. IMO - but it's been some years since I was in this situation myself.
If you cannot spell or use the correct grammar then any money made should go directly to the needy, ie ME
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What??
Sorry I missed a comma out
thats rude,
Extremely unnecessary, dtgblue.
-- answer removed --
And so a summary: -
1) It is a business and you are liable to pay tax on any net income that you make from it.
2) Net income means the difference between the money that tenants pay in rent but less any expenses you have incurred
3) Expenses can include many things allowed by HMRC but mainly, the interest on any mortgage you have, the cost of any maintenance you undertake on it, the cost of the management company

Ignore what rosehusten says above - it is totally meaningless statement
We let our house through a letting agent about five years ago. As we were both on the mortgage, we were both taxed on the rental income less any allowed expenses. As I wasn't working at the time, my half was tax free, but my oh had to pay tax on his half. You should inform your tax office.
bm has pretty much summed it up perfectly but just to emphasise in case it's not absolutely clear.

The CAPITAL element of a mortgage repayment is NOT an allowable expense against the rental income. Only the interest element is allowable.

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