Letting your property to family means allowing some of your relatives to live on your property may sound so easy, but legally it is not. Multiple issues can be there as consequences. Buy-to-let news is a hot topic in the market, but we never talk much about letting property to our near and dear ones.
Here, we will discuss the rules, regulations, limitations, and boundaries of letting your property to your close relative. If you want to get a close-up of this topic, then this article can help you. So, let’s peek in.
You Have to Charge a Rent
Letting a property to your family member is good, but you have to remember that they will still be your tenant and you are doing business. So, you are obliged to charge a certain amount as rent. If you ask for buy-to-mortgage, your lender will charge a good percentage of your monthly mortgage cost. You have to pay that all for the property that you are letting. So, it will not be a very wise decision to let them stay for free.
Get a Rental Agreement
Make sure you have prepared legal documentation of the rental agreement. Though they are your family, the law is the same for all. Getting an agreement signed by your loved ones may become a bit awkward, but it is necessary. Otherwise, you will have written proof against everything if anything goes wrong. According to the experts of conveyancing Brisbane, if eviction is needed, it will be easier if you have a legal document with you.
Make Sure the Property is Legally Let
Your trust level will improve with your family than with any stranger tenant. Still, it is necessary to make everything clear in the eyes of the law. It is important for both you and your relatives who will be your tenant. They have to abide by all the rules and regulations as a tenant of the property.
They have to follow the Housing Health and Safety Rating System. The landlord is also liable to make sure the tenants are living there. Hence, you also cannot neglect your responsibilities as a landlord, even if the tenant is your family. They should not suffer because they are related to the landlord. According to RCB Law, as a landlord, you are bound to resolve all your tenant’s problems.
You Still Have to Pay the Tax
Even if you let the family, you still have to pay the tax against the property as everything is legally documented. They may be related to you, but they still are paying the rent, which is an additional income. So, you are liable to pay income tax for that excess income. The tax will be decided depending on the current value of the property.
Bottom Line
Letting your property to your loved one is hassle-free until you are running on loss. So, think wisely before making any move. You can go through the rules and regulations of RCB Law to know more about it.
