Below is a summary of the types of owners and requirements that need to be included in your reporting
Reporting requirements for different ownership structures
When it comes to reporting rental or financial income, the ownership structure of the property plays a crucial role in determining what information must be submitted. Here is a detailed breakdown of reporting obligations based on the type of ownership:
1. Individual owner
If a property is owned by a single individual, that person is the one who must be reported. It’s important that their personal details are provided accurately, especially if they are the sole recipient of any income generated.
2. Multiple owners
When a property is owned by more than one individual, the reporting requirements vary depending on how the income is received:
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Joint Bank Account: If rental income is deposited into a joint bank account, each owner must be reported individually. The correct bank account must be assigned to each person accordingly.
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Single Recipient: If only one person receives the income, even though the property has multiple owners, only that individual needs to be reported.
3. Partnership business
In the case of a formal partnership, the business itself must be reported. Additionally, the Unique Taxpayer Reference (UTR) for the partnership must be included in the submission. This ensures that HMRC or relevant authorities can correctly track the income.
4. Limited company
For properties held under a limited company, the reporting must be done on behalf of the company. It is essential to include the Company Registration Number (CRN) in the report to ensure compliance.
5. Sole trader
If the property is managed as a sole trader business, reporting should include the sole trader’s UTR. When specifying the business type, it should be listed as a Partnership, despite the business being operated by one person.
6. Property held in trust
Properties owned in trust have specific reporting requirements based on how the trust is structured:
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If the trust operates like a Partnership, include the UTR.
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If it operates as a Limited Company, include the Company Registration Number.
7. Change of ownership through a reporting year
If a property changes ownership during a reportable year, you can assign the property to the previous owner and set their status to Inactive. This will allow you to record payouts against that owner, which can then be included in DAC7 reporting if you mark them as reportable.
This video will help to explain things further
8. Reporting types:
New Data: The first time you file your DAC7 report for a given reporting period
Resend New Data: Used to add new sellers or transactions that were missed in the original report.
Corrected Data: Used when you need to fix incorrect information in a previously submitted report
Deleted Data: Used to remove previously reported data (e.g., if a seller was reported in error)
Further reading: How to generate a corrections report