UK Taxation Treatment for Rental Income, Overseas Property, Rent a Room Relief

Property Rental Income for Individuals

UK Rents and licences are regarded as UK land and property. Land and property income is all income deriving from such property as if it were a trade. Therefore this is calculated as all income being assessed in the tax year on an ‘accruals’ basis. This means that income is taxed on an ‘arising’ basis in the year of assessment, i.e. income that is due in the year, and not necessary income that is actually paid by the tenant.

For example if a tenant per the tenancy agreement is obliged to pay £495 a month, the taxable income is £5,940 a year, irrespective of the fact the tenant might say pay late for their rent.

Since rental income is assessment like trade, all income from the different rental properties are pooled together, creating one income stream. Hence profits and losses of the same UK properties are amalgamated together to create the net profit or loss. In essence losses from one property is netted off against profits of the other.

If they are losses overall after pooling all the properties together, then these losses can be carried forward against future profits of property income. These losses cannot be set off against other income, e.g. employment income or self employed income. However, if losses arise due to ‘capital allowances’ this may then be relieved against other general income.

Capital allowances is the allowable decrease in value of the assets each year that are used in the properties. For e.g. fridges and ovens. Capital allowance rates will be 20% or 25% a year depending on current capital allowance rates.

Expenses are allowed to be deducted if they are incurred ‘wholly and exclusively’ for the purposes of the property.

The treatment for limited companies broadly follows the same rules as for UK individuals.

Income from Overseas Property for UK Residents and Domicile


Insurance Rules Restricting Access to Addiction Treatment Medication

The medical profession has of late started accepting the need for medications pertaining to prescription drug addiction help bringing a ray of hope to people suffering with opioid use disorder (OUD). However, a recently conducted study by clinician scientists at the Oregon Health and Science University (OHSU) in Portland, observed that insurance rules are restricting the usage of the prescription drug medicine, buprenorphine, among Medicare beneficiaries.

Buprenorphine is considered to be an effective and secure medication for treating heroin and other types of opioid addiction, thereby helping in decreasing deaths caused due to the same. According to the study co-author, Dr. Todd Korthuis, head of addiction medicine at OHSU, patients administered buprenorphine are seen to return to their pre-addiction healthy state.

Ironical move by Medicare insurance companies

In an OHSU news release, Dr. Korthuis said that ironically, while insurance companies offering Medicare policies are making it quite challenging for doctors to prescribe buprenorphine, they are making it relatively easier for them to prescribe opioid pain relievers which led to the current opioid epidemic.

For the purpose of this study, the clinician scientists carried out an analysis of data pertaining to Medicare Part D prescription drug plan and noticed that due to the increasing usage of certain pre-authorization conditions, the prescription of buprenorphine was increasingly restricted among insurance beneficiaries who signed up for Medicare plans between 2007 and 2018. Insurers commonly use pre-authorization conditions in order to restrict or manage access to certain medications to restrict costs.

The study findings revealed that around 90 percent of the insurance plans offered buprenorphine without any restrictions in 2007. However, the percentage dropped to nearly 35 percent by 2018. On the other hand, during the aforementioned time period, the percentage of plans covering prescription opioids like OxyContin sans any limitations, increased from 93 to 100 percent.

The researchers stated that the factors influencing buprenorphine restrictions may reflect inaccurately perceived drug associated risks like financial considerations or societal norms associated with addiction. The findings of this study were recently published in a research letter in the Journal of the American Medical Association (JAMA).

Benefits of prescribing buprenorphine

Approved by the U.S. Food and Drug Administration (FDA), buprenorphine is one of the three medications approved by the FDA for treating OUD and helps in easing withdrawal symptoms and the associated pain and discomfort. Daniel Hartung, an associate professor at the Oregon State University College of Pharmacy, stated that as Medicare does not and never did cover methadone, the other anti-opioid medication prescribed for treating patients battling OUD, it is important that it provides access to buprenorphine.

According to the U.S. Substance Abuse and Mental Health Services Administration (SAMHSA), prescription medications such as buprenorphine are an effective means of treating opioid addiction. Unfortunately, said Dr. Korthuis, a lot of people still hold the opinion that treatment of addiction with medications is not really the road to recovery. But scientific evidence backs the fact that medicines such as buprenorphine present a higher success rate at recovery than merely resorting to approaches based only on abstinence.

Seeking prescription drug addiction help

Millions of people have lost their lives to the opioid crisis that is presently ravaging the United States, while millions of others are facing the same predicament. There is no doubt that it would take a mammoth effort to deal with the prescription drug crisis.