Why HMRC needs a “business” for your rental income

When you connect software like Quarterwise to HMRC, one of the first things it does is ask: “which businesses are registered to this person?” For a landlord, the answer should be a UK property business. HMRC gives it a reference, sometimes called a business ID, and your quarterly updates are filed against it.

Where does this business come from?

You don't create it in the software, and the software can't create it for you. HMRC sets it up when your property income is on your tax record. There are two common situations:

• You already do a Self Assessment return with rental income. Then HMRC already has a property business for you. It shows up automatically when you connect, and there's nothing extra to do.
• You're new to letting property. Maybe you've just started renting out a place, or you've become a joint owner and have never reported rental income before. In that case HMRC won't have a property business for you yet, and you'll need to tell them about the income first.

How to register

You let HMRC know you have property income by registering for Self Assessment as someone who receives income from property. You can do that here:

• Register for Self Assessment
• Renting out a property: paying tax

Once that's done, your property business appears the next time you connect, and you can set your quarterly period and start filing.

A note for joint owners

If you own a property with someone else, each of you reports your own share under your own details. You don't share one tax account. In Quarterwise you keep the books together once, and each owner files their percentage with HMRC separately.