Paying rent into UK personal bank account
I am retired and live in France and have rental properties in London. I opened a small business account with Barclays while I lived in the UK to deal with consultancy work I had and continued the account with rent being paid into it. Barclays now says it is closing business accounts held by people outside the UK but I can keep my personal account. However, it says I cannot pay the rent into it as it is not a salary. Is this right? S.L.
The general position is that a business bank account should be used only for the business for which the account was opened.
However, where this account is in a personal name, to cover for example self-employment, it can be used again for another business activity.
The closure of business accounts for non-residents is becoming more common as a means of preventing tax fraud because if a person is resident in one country, it is difficult to see that they could have a full-time business in another country while not also being a resident of that other country.
Rental income is generally seen fiscally as investment income unless done on a professional basis, so one option may be to ask the bank to open a second personal account for your rental properties.
One would, in any case, expect rental income to be credited to a personal account, unless, as stated, the activity is effected on a professional basis.
There is no legal reason why rental income cannot be credited to a personal account, nor why only salary can be, so perhaps query this with someone else within the bank or a different branch.
Reader's query answered byHugh MacDonald
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