Rental Income - To be or not to be Self-assessed?

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I recently acquired two investment properties (they're in my sole name) and the rental from these is my only source of income. My husband is on PAYE and is taxed at 42%.

I understand that I can earn up to E19,000 per annum and pay 20% tax.

Should I register for self-assessment (is there any benefit) or can I show my income separately on my husbands annual tax return?
 
I don't think that you have any choice in the matter of how your rental income is returned/assessed for tax. See the and the links contained therein for a summary. It is a separate issue whether or not you decide to go for joint/aggregated [broken link removed] (normally the most beneficial for most couples) or one of the other two choices in case that's what you're asking about?
 
If you have no other income other than the rental income youand your husband will be paying tax at 42% as soon as he earns more than 37,000

If you earn the rental income then it will only be taxedat 20% as you stated

You do not need to register for self assessment just on the tax return show the income as yours and it will be taxed at the appropriate rate

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Thanks for your reply Stuart - I'm glad I don't have to register for self-assessment.

Not sure what you mean Clubman by 'having no choice as to how the rental income is assessed'. I had looked in the FAQ's and saw a straight 42% deduction.

Below is a bit of info which might be useful to investment property owners/potential buyers whose married partner has no other source of income.

According to a Sunday Business Post article, tax expert Alan Moore advises:

"As a 'dual income' married couple, the amount you wil be taxed at the 20% band is E38,400 plus the lower of (a) E20,400 (E19,000 was in 2004) and (b) your spouse's income.

So to avail of the full E58,800 band at 20%, it makes sense to transfer up to E20,400 of rental or other income to your spouse. This does not cause tax complications as transferring assets between spouses is exempt from capital gains tax, gift tax and stamp duty."
 
Unregistered said:
Not sure what you mean Clubman by 'having no choice as to how the rental income is assessed'. I had looked in the FAQ's and saw a straight 42% deduction.
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What I meant was that you must follow the guidelines laid down in IT 70 and related Revenue guides when declaring your rental income. I think that you are confusing self assessment with assessment as a single person albeit married. These are not the same thing. Whichever of the three married taxation alternatives you opt for you must still make a self assessed return of your rental income. I don't understand what you mean by "registering as self assessed" but again presume that you are confusing this with assessment as a single person.
 
Thanks for explaining that Clubman - I was basing my query on what I had been told by revenue when I called to ask how the rental income should be declared.

When I called the first time, I was told that I would have to complete a form STR to register for self-assessment as a 'sole trader' and declare the income in this way, showing a minimum annual profit of E3,175.

When I called the second time to ask why I had been sent form TR1, which is for those with an income above E127,000, I was told I didn't have to register for self-assessment, but could show my income on my husband's annual return!

I just thought I'd run it by the AAM forum to see if anyone was in a similar situation as I don't want to fall foul of revenue.

I think I will get some good tax advice for the first year just to start me off.

Thanks again to yourself and Stuart for your help.
 
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