Tax Credit Advice anyone?

[liznospam]

I am not an expert, but I would have thought that the figure you need is the same figure you would need to calculate for tax purposes, which is the net income, ie gross income less allowable expenses. These links give details. The second link shows expenses that can be deducted, including interest on property loans.

 

I wouldn't have thought that the tax credit people would be expert in this either as they probably don't come across it too often.

 

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_10013435

 

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_10014027

[andikay]

Can anyone help with this?

 

I am filling in the Tax Credit forms to report a 'Change in Circumstance' - my partner is moving in with me. He is letting out his flat but is not making a profit. Basically, the rent covers the mortgage on it.

 

On the form, it asks for 'Income from Property' but doesn't define what this is.

 

Do we have to put this on the form as an income even though no profit is being made?

 

Help anyone?

http://www.hmrc.gov.uk/taxcredits/start/claiming/income-hours/other-income.htm

 

Property income

 

Include income from property in the UK that you own or rent.

Don't include:

 

* income that's covered by the Rent a Room scheme

* property income that you've included as part of your self-employed income

 

If your rental property made a loss, you can use a working sheet to help you work out what to enter.

[alstromeria]

I've been told the 'Income from a Property' is the profit made from that property, ie, Rent less expenses.

 

This is where it gets tricky - define 'expenses'. Would a mortgage be classes as expenses? if so, then the income is net....

 

Right?