Splitting income from a jointly held property - USERNAME: RoddersTax - 19/07/2022

Tax Question:

If we own a rental property as tenants in common how do we split income. One partner does all the admin and management. How do we spilt the income if one landlord does more work than the other?

Answer:

Assuming there is no partnership, the share of any profit or loss arising from jointly owned property will normally be the same as the share owned in the property being let.

Of course, the underlying beneficial ownership interest could be changed, but this may have CGT implications if the owners are not spouses. If they were spouses then the entitlement to the rental income could be amended by making a declaration under ICTA88/S282B or ITA07/S837 stating the beneficial interests in both the property and the income arising from it. However, a declaration is only valid if the interests in the income and in the property itself correspond.