Mother and son own a property as joint tenants. The building is split into 2 parts. A flat is rented out and rents are split equally between the two. However, the retail unit below is ran by the mother through a separate company. The mother does not wish to charge rent to the company but the son wishes to charge and collect a fair market rent from the company for his share.
Can the mother simply waive her right to charge rent to the shop? Presumably the 2 will remain beneficial and legal owners of 50% of the property each?
Related resources
Replies (2)
Please login or register to join the discussion.
Nothing Forces Her
Nothing forces the mother to charge a rent for the shop part. Might want to be careful of mortgage interest claims against her rental income from the flat, as she will only be able to claim that proportion that relates to the flat. If there is no mortgage then this isn't a problem.
Not sure of the future CGT position, maybe someone can have a think on that.
Charging or not charging rent won't affect the ownership.
It should be possible to adjust the profit sharing on the flat to reflect the overall position of both mother and son?