A client who has been on PAYE during the year has now got an income from renting a property. Do I need to make him Self Employed in order to get the tax paid from the property rental income. Is there another way by using his tax code. Any help appreciated
Its property income which is seperate to the self employed pages on the self assessment return.
The taxpayer does however have to now be registered for self assessment.
That we have already passed the end of Jan and I assume that a self assessment return has not been filed means that the automatic penalty of £100 will already kick in if the taxpayer should have but failed to be registed for self assessment by the year end. (they should actually have been registered before the 5th of October).
No, you cannot use the tax code instead of self assessment.
kind regards,
Shaun.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I've had a client already in SA, so the Revenue knew all about him and his circumstances were unlikely to change again.
At the time, I knew the Revenue were keen to bring people out of Self Assessment but was surprised about four years ago when they did so to a client with rental income. Although I found it a 'faff', I wanted to see how routine it was so went along with it I prepared the simple accounts, but instead of completing the Land and Property pages, just wrote a letter with the profits, which were quickly coded out. I understand this is common now, but I was intrigued back then.
Obviously you must inform HMRC about a new source of income on time, but depending on other income sources, this may not be an automatic self assessment case. If this is straightforward PAYE, for someone below higher rate tax threshold, then I would be inclined to send in as much as possible: the accounts, breakdown of any other income, tax calculation and written reqest that the profits be deducted from personal allowances.
Its property income which is seperate to the self employed pages on the self assessment return.
The taxpayer does however have to now be registered for self assessment.
That we have already passed the end of Jan and I assume that a self assessment return has not been filed means that the automatic penalty of £100 will already kick in if the taxpayer should have but failed to be registed for self assessment by the year end. (they should actually have been registered before the 5th of October).
No, you cannot use the tax code instead of self assessment.
