Co-owned rental accounting

Question from Parveen updated on 6th March 2013:

My and I have brother bought a rental property together. I have been filing an IR3 return for the last five years in my name. How do I account for the rental property? Is it necessary to file a revised return or just leave it as I am planning to sell the property soon? How will I file the revised return?

Our expert Mark Withers responded:

It sounds like you are in partnership with your brother for the investment properties you own together. As such, you would file an IR7 partnership return for the partnership income and each partner would file their own IRD return declaring their share of partnership income. The income declared by each partner obviously needs to reconcile to that in the IR7 partnership return.

Mark Withers and his team at Withers Tsang & Co specialise in advising on property related transactions, valuation and restructure services and tax planning.

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