Property Rental and Partnership Accounts

Hello, I'm not sure if many people are around, and those who are around are probably very busy. But it's worth a try!

I have a client who has a small business that is not connected to property in any way. He also has rental income from renting out a room in his house, and he's pushing me to include the (modest) rental income in his trading accounts. His main business is registered for the Flat Rate VAT Scheme. He would also like to claim Rent-A-Room relief on his rental income.

I have my own view on whether this is possible, but would appreciate other views. I have used partnership arrangements for rental income before (something that was accepted by a Tax Inspector at the time), and have seen at least one other accountant using partnerships to allocate rental income between a husband and wife.

Is it possible to include the rental income in the partnership accounts, utilise Rent-A-Room relief and not have to worry about paying Flat Rate VAT on the rental income?

Comments
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What exactly does he expect to achive by doing so?

ACDWebb |
ACDWebb's picture

I agree with ACDWeb but would add:

neileg |

Thank you for your comments.

mabzden |

VAT on rents!

Novakova |
Novakova's picture

Rent-a-Room

thehaggis |

Has he given you ANY reason

ACDWebb |
ACDWebb's picture

Let's be clear about this

neileg |

FRS

Novakova |
Novakova's picture

@Novakova

neileg |