I bought a property in 2008, my first property. I bought it as I wanted a foot on the ladder but also it coincided with my mother and step father getting divourced.
My father moved in and was happy to pay £600 rent, a figure that was close to market rate but reflected my cost of interest only mortgage at the time.
I thought nothing else of it, the property until 2012 and rate reduction to SVR was not making a profit. However I have now been advised to make a declaration under the LET PROPERTY CAMPAIGN for the income.
My question is how best to change the circumstances, as it feels inefficient to be paying tax on money received from my father.
Some basic numbers:
Last year I became a 45% tax payer
The house is worth c£225,000
Interest only mortgage of £150,000 in my name
I have £50,000 in an offset account changing the interest payable from £330 to £190.
I am married my wife is a 20% tax payer
My father is 75 and retired
The property has never been my main residence and I have owned a other property since 2010.
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