UK Landlord Forum / Life

Hi,

My husband applied for buy to let mortgage by himself. We would like to put myself only on the tenancy agreement.
I wonder if that is possible and if in this way I would be responsible for paying taxes from the property income.
I am taking care of family, hegoes to work, so if he would be the one paying taxes it would become quite expensive.

Please advise me if it is possible to put me as the person who earns money from buy to let in spite of not having my name on the mortgage.

Thank you,
Anna

In order for you to be the one who is taxed on the rental income, your husband will need to give you the house.

This isn't as drastic as it sounds: you don't need to go through conveyancing, there's no stamp duty to pay, you needn't update the Land Registry title and the mortgage arrangements can remain the same. You just need to get your solicitors to draw up a Declaration of Trust, whereby your husband gifts you all or part of the property.

Solicitors being solicitors, they'll probably charge you a few hundred quid for what is a bog-standard document but it'll pay for itself in a few months.

My wife and I have a similar arrangement. She's actually the landlady: I'm just here because I like reading the blog! 

As suggested, talk to a professional because the last kind of situation you want to create (even if by accident) is one where you're being accused of mortgage fraud or tax evasion.

Simplistically speaking - income tax is due on income, so whoever earns the income pays the income tax. Usually that would be the owner - not necessarily the person who paid for the property, I guess.

Hello,

I would recommend speaking with a property law solicitor. I use Courtyard Solicitors and they have been really helpful and have fixed fees which is really good.  Here is their website: http://www.courtyardsolicitors.co.uk/fixed-fees

Hope that helps!

Jess 

Simon is right in what he says.
You could also execute a Deed of Covenant committing you to pay over the income or Trust Deed that assigns the income.
Just make sure doing so does not breach the terms of the Mortgage.
Note, subject to the terms of your Mortgage,  you likely need not inform your mortgage company so long as the legal title is unchanged.

You might need some help in the drafting to make sure you only get the net income between rent and mortgage costs as the mortgage is in husbands name (that's bit tricky as he has to earn the rental income first and deduct the mortgage payment) ... but with the imminent tax changes that wont be an issue for long  or set it up so you get the income in a separate bank account in your name and then make a payment to him for the mortgage.

[just to be clear when Simon writes 'gift you the property' he means gift you the beneficial interest in the property (not the legal title)]

Best of luck