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Where Taxpayers and Advisers Meet

Looking for some advice please

simlocked
Posts:1
Joined:Fri May 07, 2021 3:57 pm
Looking for some advice please

Postby simlocked » Fri May 07, 2021 4:16 pm

Hi looking for some good advice, this isn't going to be the norm, but, here goes, my son got a commercial property as a gift from my mum after his grandad died, this was my dads intentions if he passed away, he was gifted the property 3 years after my dads passing by my mum, me and my son who was only 15 and a half at the time opened a business there and was there for 9 years, in the end i grew tired and exhausted and had to give it up, as the property was my sons he decided to rent it out he knew nothing of how to do this neither did i, so we hired a solicitor and made a lease to rent out the property, he did this for the last fives years, we checked online about tax he had to pay and if you don't earn over the tax threshold there is not tax to pay, but we have only just found out that you have to still submit a return, big problem ahead with HMRC, my son is worried to death, the solicitor who write the lease didn't mention any of this to us, anyway, my son was addicted to weed, the smoking kind, not the garden kind and was smoking weed before he came to live with me and his youngest sister, after his renting out the property his addiction had lead to two cocaine seizures which you can die from and getting in debt with the wrong type of people causing family chaos, demanding money with menace banging your door at 12 o'clock at night, so we manged to get him to put the property in my name fearing that if we didn't take this action he would be dead by now, he's squandered every penny of what was rent as by this time now he is in his late 20's, so in the middle of changing this all over i have now found out that there will be CGT to be paid, we had no idea that we have to pay any tax as it's gifted, we have scraped together the money for a solicitor to change it over as i have had no work due to this Virus so have been struggling quite bad with money and mental health with all the stress built up, so we want to know how we can maybe lesson this debt in anyway or ask HMRC if they will take payment until we can arrange another lease on the property as we have just found out that you have to pay this tax within 30 days of the it being gifted, any help we would be so grateful, thank you

Jholm
Posts:184
Joined:Mon Mar 11, 2019 4:22 pm

Re: Looking for some advice please

Postby Jholm » Tue May 11, 2021 9:27 am

Tax returns must be completed if rental profits are over £2,500 or gross rents are over £10,000.

Assuming I am keeping up, there are basically several years of rental income, on which tax has not been paid?

If so, consider looking into the Let Property Campaign to report the profits across the years. Interest will be charged on unpaid tax and penalties depend on the reason for the prior non-disclosure. Bear in mind, any years where he would earn under the PA, the penalties would be a % of £0 so not always as bad as it could be.

You mentioned stumping up for a solicitor. I would suggest stumping up a little extra for an advisor/accountant, since any savings that could be made could outweigh the cost of their services.


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