Q: I’ve heard about landlords using “Form 17” to reduce their tax bill on rental income. What is it and how do you qualify?
A: Form 17 can be used by married couples (or civil partners) when they jointly own a property at different percentages, rather than a 50/50 split. This is beneficial if the owner with the larger share is a basic-rate taxpayer and the other is a higher-rate taxpayer, as the larger proportion of the rental income will be taxed at the lower rate than would have been taxed with a 50/50 split of the income.
It should be noted that this cannot be used for commercial letting of furnished holiday accommodation. You and your partner must hold the property as “tenants in common” and not “joint tenants”.