ACC F6 UK (Taxation)- Property business income proforma

A person having UK domicile has to pay tax on property business income . Tax is levied on his property business in UK and also on outside UK property business .

A UK domiciled person is who lives in United Kingdom and holds it,s nationality .



For the purpose of examination , you are required to calculate and deal with the following property business incomes :

*Property business rental income
*Premium on a short lease
*Rent a room scheme
*Furnished holiday  letting profits

 Property Busines Income ( P.B.I ) :  Rental Income format / Proforma


                                                     £                               £

Rental Accrued                                                           xxx


Less: Allowable expenses

Insurance                                     xxx
Agents fees                                  xxx
Management expenses                 xxx
Interest on house loan                   xxx
Repair and maintenance                xxx
Advertisements for tenants             xxx
Decoration costs                           xxx
Council tax                                   xxx
Water rates                                  xxx
Bad debts                                    xxx
Wear and tear allowance               xxx
                                               _______                         xxx
                                                                                  _______

Net rental income                                                        xxx

                                                                                  _______



 Property Busines Income ( P.B.I ) :  Premium on a short lease format / Proforma


It does not involve a format or proforma to calculate it .It is calculated by use of formula and other bookish knowledge.



Property Busines Income ( P.B.I ) :  Rent a room scheme format / Proforma


This below given format is used to calculate tax when a taxpayer lets only a single room in his house , the rent received against it will be taxed under rent a room rules and format.

Method 1 - Normal assessment                            Method 2- Rent a room relief 


£                                                                          £

Rental income                     x                                Rental income                  x
Less: Expenses                 (x)                               Less rent a room relief   (4,250) 
                                                                                                               _______   
                     
Less: W&T allowance         (x)                                Profit                              x     
                                    _______ 

Profit                                  x   
 


 Property Busines Income ( P.B.I ) :  Furnished holiday letting profits format / Proforma


Furnished holiday lettings are occasional letting properties that are let furnished and are not available over the whole year for letting . There is no specific format or proforma to calculate tax on furnished holiday lettings . For tax calculation purposes first students have to identify that a property falls under furnished holiday letting or not ?. There are some conditions that should met for a property to be treated as FHL.

If a property is treated as FHL ,  then tax is calculated under specified  rules not a proforma or format .

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