Tax on Rental income - non-working partner as landlord

[finkie]

I am renting out my house and moving elsewhere to rent a home that better suits my family needs.
My house is in my name as I bought it before I was married. My wife is not working and currently we are jointly assessed for tax.
So I am looking for a tax efficient way of dealing with rental income.
Is there some way that the income from rent can be paid to my wife as a source of income such that it makes better use of her tax credits and band allowances? For example can I rent the property to my wife for some small amount and she sublets it for a market rent? It sounds fair to me as it is her responsibility to handle renting and looking after the place anyway!

 

[mystrikeoff]

Honestly, I think the Revenue would see through that arrangement. That said, I'd be interested to hear other views on it - I'm open to correction.

Is it an option to transfer the house into your wife's name or make her joint owner? At least then she could justifiably be taxed on rental income from that property.

 

[Graham_07]

Transactions at less than "arms length" would always be suspect. The only way she could realistically be seen to be the landlord would be if she were the owner or part-owner. In a case of joint ownership then 50% of the taxable rent would be charged to each spouse.