Can you base buy to let rental on cash basis?

Can you base buy to let rental on cash basis?

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Can you base buy to let rental on cash basis?

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By thomas34
23rd Oct 2015 14:07

No

There is no option yet of applying the cash basis to lettings income. I would have thought that the difference between accruals accounting and cash accounting would be minimal in the vast majority of cases although I suppose late receipt of rents might lead to a cash flow disadvantage.

 

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Replying to TheMonarch:
paddle steamer
By DJKL
23rd Oct 2015 14:32

You can get the

thomas34 wrote:

There is no option yet of applying the cash basis to lettings income. I would have thought that the difference between accruals accounting and cash accounting would be minimal in the vast majority of cases although I suppose late receipt of rents might lead to a cash flow disadvantage.

 

You can get the reverse.We had a view residential tenants over the years who were say unemployed/ resting, who sealed the lease 9because failed "credit" check so to speak by paying six months rent up front at entry. Also had a pub chain who did likewise re a flat for visiting staff.

However my experience is that normally, as you say, there is little difference.

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By Cloudcounter
23rd Oct 2015 16:39

Yes, in some cases

See HMRC PIM111

 

Scroll down for reference to cash basis in small cases

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By petersaxton
23rd Oct 2015 17:57

£15k per year

If the rental income is less than that you can use cash basis.

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By MDK45
23rd Oct 2015 20:26

Surely hmrc would not be too bothered if consistency applied? Pragmatism has to prevail here, the difference between accruals and cash accounting minimal.

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Replying to Paul Crowley:
By petersaxton
23rd Oct 2015 22:59

Wait until HMRC find out

MDK45 wrote:
Surely hmrc would not be too bothered if consistency applied? Pragmatism has to prevail here, the difference between accruals and cash accounting minimal.

I'm sure HMRC would work out the correct basis if you didn't apply the rules properly - and who could blame them.

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Replying to tltodman:
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By MDK45
24th Oct 2015 08:26

Sorry the point i was trying to make more was not that there is an 'either or' over the threshhold for this but i was thinking more about the granular blurry date nature of receipts payments sometimes.

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