UK Tax Questions? Ask a UK Tax Advisor for answers ASAP
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.
You should declare the moneys paid to the lender by your parents as rentals on your Annual Self Assessment Tax Return. The following are the normal deductions which can be made from rentals [source: Which]:
'The most common deductions from rentals are:
The expense should be incurred wholly and exclusively as a result of renting out your property.'
These may well reduce the payments by your parents as taxable rentals to nil.
I do hope that you have found my reply of assistance.