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Thanks for your question and asking for me.
When did the marital home cease to be the your main residence? (When did you move out)
The house was sold in March 2012.
Thanks for this information, but is this also the date that the property ceased to be your home?
If so, then please expand on what you are seeking to establish.
I asked about the rights my wife has to a share of the family home.
And thereby the right to derive income.
As already stated, for tax purposes, the income is deemed to be taxed on the owner of the property, and that is you (as the deeds and mortgage are in your name only)
The fact she may have a right to the share of the family home in legal terms should you not remain married, has no bearing on the tax position, as for divorce purposes, this is merely a division of finances to recognise each of the spouses contribution to the marriage and their legal entitlement (which takes into account pensions, and assets, but your pension is deemed to be yours, until such time that a legal instruction states otherwise, so with assets this is no different, or imagine the mess that would ensue!)
To conclude. My wife has the right to charge for her work in managing
the rental property?
And this is will go back to 2003?
Thanks for your response
Not in retrospect, no, but she could have done so at the time (Had she in fact been paid for the work she undertook) but you cannot alter now, what clearly did not take place in fact.
I don't understand.
My wife did work. She received income.
These are facts.
There may be a discrepancy between the income and the work.
i.e. Some money should have been paid for work.
Some money received was investment income, for which we now know she was not eligible.
2013 7:47 AM EST
So did she take a wage from the rental income money and this was advised to HMRC during the periods in question?
I've been trying to ask my accountant what my wifes income was.
I explained then in 2003 that my wife did work for the rental property.
He said, it didn't matter what the income was it would appear somewhere on the tax return.
He thinks it's the same thing.
It does matter what wage your wife took - as this is the basis of trying to put matters right, and establishing what income (as employment) was taken, to amend her tax returns from rental income, and to amend yours to include rental income and allowable expenses (of which some would be the wage paid to your wife)
And if she had been paid a wage, then this would show clearly in monies that were paid from you to her (so backed up with bank statements and wage slips) so this creates a paper trail of evidence.
I am confused why your accountant states it doesn't matter what she was paid, it would appear somewhere on the tax return?? What does this actually mean, as you have previously advised that "There may be a discrepancy between the income and the work.
Some money received was investment income, for which we now know she was not eligible."
So lets look at the facts.
The property was in your sole name, for the period 2003 to 2012 and it was rented out and rental income received
This rental income will be treated as yours by law, and you would be considered liable to tax on net profits. You should have declared all of the rental income on your tax return. So the rental income was either paid TO you or TO your wife.
The expenses that can be deducted from the gross rents, should have been claimed on your tax return - and you advise that a wage WAS paid, so you have evidence of these transactions either through
1) Rents paid to your account and then you paying a wage to your wife OR
2) Rents paid to your wife and her deducting her wages and paying the balance of rents to you
3) Rents paid into a joint account - and your wife took a set amount as a wage
4) Some other scenario
But in ALL cases - PAYE was considered to allow the tax and national insurance deductions from her wages, and this wage along with relevant deductions were reported to HMRC