I’m not entirely sold on the idea. Just that it is all very complicated as it is & it might be best to just sell it.
Where is the definition of what you can & can’t do?
- Thread starter Kikki21
- Start date
I’m not entirely sold on the idea. Just that it is all very complicated as it is & it might be best to just sell it.
Indeed it is, or can be very complicated. Any decisions you make now about renting should take into account that after doing it for 6 months/ a year you may decide it isn't worth it, so i'll just suggest you just adjust any unnecessary expenditure at this stage and see how it goes. 6 months deferred payments + interest at 2% isn't going to be that much and you can always reassess the situation.
It sounds as though you have already pretty much reached the decision so I hope it goes well. I hope the Airbb route however can provide you with the confidence that you can keep your mum's property secure and without risk as will be your responsibility to protect or use her assets catefully as her Deputy in terms of not quite knowing who all these different regular occupants are as no contract and presumably references etc any background info would not be obtained however as you have been a landlord I would imagine you have given this sone thought alteady. Many of us have found that whilst ideally we would not have chosen to sell a property it comes down to what is the sensible conclusion for individual circumstances. Dad's end of life came about suddenly and with no warning...I thought he would still be walk I g the corridors of his NH for years. Another resident was awarded fast track CHC 2 years ago with weeks to live on medics assessment and she is still around...just can't tell sometimes.
I’ve not reached any decision as yet but it will make sense for me to defer the payment of the care home fees which will probably be the next thing I have to do.
I may as well clear the house out apart from all the items that would stay if I were to rent it out on Airbnb.
You can give people staying at the property bad reviews so that other people are aware that they are not a good prospect if they are wanting to stay at yours but we have not had issues with anyone staying at the flats.
I’m not going to spend lots of money on it all. I did my fiancé’s flats up on a strict budget. We have a fantastic bloke who works really hard who does all the labour, he can paint, wallpaper, lay down floors. The full lot.
Neither my mum & dad worked their hearts & souls out for this to happen & for me to have to do this, just because my mum got dementia!
I may as well clear the house out apart from all the items that would stay if I were to rent it out on Airbnb.
You can give people staying at the property bad reviews so that other people are aware that they are not a good prospect if they are wanting to stay at yours but we have not had issues with anyone staying at the flats.
I’m not going to spend lots of money on it all. I did my fiancé’s flats up on a strict budget. We have a fantastic bloke who works really hard who does all the labour, he can paint, wallpaper, lay down floors. The full lot.
Neither my mum & dad worked their hearts & souls out for this to happen & for me to have to do this, just because my mum got dementia!
You must know far more than I do about the tax concessions available to business and corporations, seeing as to my knowledge they are minimal, although there is an awful lot of what is now called 'fake news' surrounding this and has been for decades. I work as a corporate tax manager advising SMEs (small and medium enterprises) how to correctly calculte their tax liability, ie many items of expenditure are not allowable for tax. I have been doing this job for 20 years and sadly certain sections of the media have always perpetuated this myth.
As far as tax on rental income for an individual goes, if the property was sold there would be investment income in the form of interest or dividends and this would be taxed - so tax would be payable either way.
The current climate is to tax let property heavily, so the tax on rental properties has increased in recent years (stamp duty land tax premium, disallowance of loan interest etc) as it is considered by those that claim to know that this is artificially inflating the house price market.
As far as @Kikki21 10% admin charge goes - I think that is worth asking OPG, as if you didn't do it you'd have to pay a management agency the same money and it seems fair enough to me, taxable income for you and a tax deduction for your mum though.
I've come across very succesful AirBnB lettings, some of our clients have switched their properties over to this as they were letting more succesfully, but it does require the input of fresh linen etc so a admin charge by you sounds sensible. If the property is in the right place I would expect a much higher return via Airbnb than a conventional let.
(just seen your last post @Kikki21 which you posted whilst I was typing)
You have to let them know if you are letting the property and get their permission but yes, LA's will agree to a DPA if the property is let. I'm in the process of getting a DPA - just short term pending the house sale - and the LA has twice suggested that I consider renting it out. I think what they do is take into account the rental income when calculating the amount they will lend under the DPA so that they don't have to pay so much of the care fees. Different LA's seem to have different rules though so suggest that the OP talks this through with the relevant LA first before making a decision (if not already done so).
Yes, if they approve the contract with the tenants but doing it on airbnb who knows?
As I understand it the LA needs to secure a first charge on the property before they'll do a DPA and any income will be subject to income tax and the airbnb charges.
Airbnb lets with no contract? Will the LA do a DPA because none of these modern concepts seem to be covered in old legislation, I would think not and expect the LA to refuse a DPA.
K
@jugglingmum I bow to your experience, but understandably I find it it hard to accept that it is fake news that Phillip Green who owns Top Shop paid himself a £1.2bn dividend in 2005 but avoided paying £285m income tax on this as he claimed Top Shop was owned by his wife who is not liable for tax as she lives in Monaco. Or that there are over 100,000 people in the UK claiming non-Dom status, meaning they avoid paying tax. Or that when people make ‘donations’ to the public school where their children are being educated, they get money back as ‘tax relief’ because private schools are given charitable status. Or that high earners can significantly reduce their Income Tax by being paid through a private company rather than directly, as ordinary people have to do. I only question whether it is right that income from property rental strictly for the purpose of paying for care for PWD, should be taxed.
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That's certainly what I assumed you meant.
If our loved PWD didn't have to live in care, they would still be in their own home and not having to rent out their home or be paying such huge fees for 'that privilege'!
