Re: Renting out primary residence

On Thu, 21 Jul 2005 11:30:11 +0000 (UTC), <nospam@xxxxxxxxxx> wrote:

>If I were to rent out my primary UK residence for 1 year (I have no other
>NON-UK residence either but that's my problem!) what happens with council
>tax - do the people renting it from me pay it - and what about other bills?
>Things like buildings insurances / ground rent / maintenance /service costs,
>etc - or do I just factor these into whatever I decide to charge?
>
>Also, what would be the tax implications for renting out my only abode (I
>would be going travelling for 1 year = no other income!)?

I've been living overseas for a number of years, and have been renting
out a UK property.

You can negotiate it any way you like with the tenant, but the way it
normally works is;

Tenant pays: Council Tax and utility bills.

You pay: Maintenance costs and building insurance.

The reason you should pay the insurance is its in your own interests
to make sure the policy is always in force in case there's a claim by
a third party (eg roof tile falling off and injuring someone etc.). If
you agreed that the tenant would be responsible for insurance, but he
had allowed this to lapse, then you would have no protection against a
claim made against you.

In my case, I did agree with the tenant that he would be responsible
for maintenance, and that seemed to work quite well. Its not easy
trying to arrange for repairs to be carried out while you're away
overseas.

Unfortunately, you'll still have to pay tax on the income from the
rent. If you use an agent, he is required to withhold part of the
rental money. If the tenant pays you directly he will have to deduct
that from the rent. You can deduct maintenance costs against tax, and
you still have your personal tax allowance.

Chris

.

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