Well, if family a were to rent their flat on the market and rent flat b then instead of paying the nominal difference in rental value (£500) they end up paying roughly 50% of the total market rental amount (£1500) because of paying a high rate of income tax on their rental income.
So that seems nonsensical, hence the original question.
Well I was suggesting if you swapped flats then family A would only be paying the difference in market rates to family b. So the overall rental income for family b would be unchanged.
For instance family As flat is £2500 / month. Family Bs is £3000.
They would swap flats and family A would pay £500 /month. Then family B would sub let the Family A flat for 2500.
My answers
How come?
Because the two families are still liable for the income tax on their full potential rental income ?
Or because I've misunderstood something else?
Well, if family a were to rent their flat on the market and rent flat b then instead of paying the nominal difference in rental value (£500) they end up paying roughly 50% of the total market rental amount (£1500) because of paying a high rate of income tax on their rental income.
So that seems nonsensical, hence the original question.
Well I was suggesting if you swapped flats then family A would only be paying the difference in market rates to family b. So the overall rental income for family b would be unchanged.
For instance family As flat is £2500 / month. Family Bs is £3000.
They would swap flats and family A would pay £500 /month. Then family B would sub let the Family A flat for 2500.
As I understand it you can swap homes for holiday rentals and there's no reason why you couldn't for longer term lets.
As I understand it you can swap homes for holiday rentals and there's no reason why you couldn't for longer term lets.