I am in an unmarried relationship with my partner, and we have a property owned 50:50 that we rent out. I am a higher rate taxpayer and my partner is a basic rate taxpayer. Can we change the income so that my partner receives 90% of the rental income and thereby reduce my tax burden? If we can, how do we formalise this? Or do we need to formalise? Also, would it be possible for me to cover 90% of the costs and, therefore, improve my tax situation? 

Arthur Weller replies:  

You can change the income so that your partner receives 90% of the rental income, and you receive 10% of the rental income (see HMRC’s Property Income manual at PIM1030), as you have written. You should have a written agreement to this effect, and 90% of the rental income should go to your partner's personal bank account, and 10% to your personal bank account (see HMRC’s Trusts, Settlements and Estates manual at TSEM9310). There isn't anything explicit I know of to answer your last question, but it seems to me that HMRC would expect that the person who receives 90% of the income should cover 90% of the costs.