If a property rental business is operated through a genuine partnership, HMRC will tax each partner on the amount of income as shown in the partnership’s accounts. This means that the split of income can be changed each year if required.
On the eventual disposal of your property you will have to consider the capital gain tax (CGT) consequences. This tax will be levied on the difference between the proceeds/market value and your capital costs. It is therefore prudent to keep a contemporaneous record of these capital transactions. If you can let us have the following details, we will include a memorandum on your annual rental accounts.
1. The dates the property was purchased and cost or the date the property was inherited and the probate value.
2. The expenses of acquisition.
3. Particulars of any capital costs (new kitchen. Bathroom, etc).
4. The dates the property was your principle private residence, if applicable.