What are the HMRC Simpler tax categories for landlord transactions?
There are a number of different categories used by HMRC when you file your taxes to help you separate and organise your business finances.
If you are able to use Simpler tax categories, there are less options to help simplify how you report to HMRC.
Please be aware that Monzo cannot provide any advice on how to categorise your individual finances, as we are not regulated to provide tax advice. If you are not sure which category to use, please consider contacting HMRC, researching the categories online, or getting professional tax advice.
If you are looking for the Simpler tax categories for other sole traders that are not landlords, please use this article
Here is a list of the Simpler tax categories available to landlords with Monzo and some examples:
Income Categories:
Rental income
Money you earn from your property/properties (not including ground rents, rent charges and rent-a-room rental income)
Example: rental payments from tenants.
Non-business income
Money you receive that isn't related to your business.
Examples: gifts, personal income, refunds unrelated to your business.
Other property income
Other income for services provided to tenants.
Examples: maintenance charges, communal area charges
Rent a Room scheme income
Money you earn from your property/properties under the Rent a Room scheme
Examples: rental payments from tenants under the Rent a Room scheme.
Tax taken off rental income
Other tax taken off rental income.
Examples:
This is a refund I have received
A refund that your business has received. Please select the category that matches the expense transaction for the refund.
Examples: Refund for returned supplies or a cancelled service
Expense Categories:
Business Expense
This is a cost that helps you to run your business.
Examples: Supplies, Marketing, travel, utilities for business premises
Amount of relief brought forward
Amount of residential financial costs carried forward.
Examples:
Rent a Room relief claimed
Deductions due to relief claimed under the Rent a Room scheme.
Examples: Rent a Room relief deductions.
Tax relief from residential cost
The residential financial cost deductible from rental income (tax relief).
Examples:
Refund Given
This is a refund that you have given from your business account(s)
Example: Client cancelled a service or order
Other Categories:
Paying myself
Payments to yourself from the business.
Examples: Personal funds, reimbursed expenses
Paying taxes
Payments to HMRC from your business.
Examples: Income Tax, National Insurance Contributions
Personal cost
Money spent on something that wasn’t for your business.
Examples: your home food shopping, medical prescriptions
Transfers
Moving money between accounts that both belong to the same business.
Examples: Cash withdrawn from your Monzo account for the business, payment to an external business account from your Monzo account.
Not relevant to my business
Money moved into or out of the business account that does not relate to your taxable income.
Examples: Mistaken transfer, Income for another business, personal groceries
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