Rental property query

Rental property query

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Hi All

A quick and probably stupid query. A client has just purchased a rental property which will be let to a member of their family at a slightly lower commercial rate but still enough to make a taxable profit. There is a rental agreement in place. Does the income still get taxed as normal as it is a family member?

Any comments would be great.

Best

Loner

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Euan's picture
By Euan MacLennan
13th Jul 2012 11:08

Non-commercial letting

If by "slightly lower commercial rate", you mean slightly lower than a commercial rate, there is no problem with deducting costs up to the amount of the rent, but you cannot turn the property into a loss.  See the HMRC guidance PIM2220.

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By Settingupalone
13th Jul 2012 11:21

Thank you very much for this information and link.

L

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