From the “not so fair files…….”
The rental property made a loss for the year, which we were able to offset against his business income, thereby reducing his tax cost.
Student loan repayments are based on earnings for the year. Using our tax principals we based our calculations on taxable income (business income, less rental loss). Not so, says the tax man, you must exclude the rental loss for student loan purposes and repay your student loan based on your business income.
Continuing our conversation with the tax man, the question arose about a rental profit - logically, if we have to exclude a rental loss from student loan repayment calculations, then we can exclude a rental profit. It appears that our logic is flawed - if you make a profit from your rental property, your student loan repayment includes this as well as your business income.