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How to tax rental income received as part of a trade

Shared from Tax Insider: How to tax rental income received as part of a trade
By Meg Saksida, January 2022

Meg Saksida explains the tax treatment of rental income received by the owner in the capacity of a trader. 

Usually, we focus on an individual making rental property income and the taxation rules for reporting the income and deducting the expenses from that income in their capacity as an individual.  

However, it could also be the case that the rental business is not run by an individual in their capacity as an individual taxpayer, but in their capacity as an owner of a trade (or profession).  

Is the rental income then trading or property income? 

'Accidental’ landlord?  

A number of situations may arise where rental income might be received within a trade or profession. For example, a trader may simply go out and purchase a property and let it out. This is simple, as it is clearly property income and taxable as such.;&

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