What Income Proof Will I Need for My Mortgage?
Understanding Your Income Proof Requirements
When applying for a mortgage, one of the key factors lenders consider is your ability to repay the loan. To assess your income, lenders will require specific documentation. Here's a breakdown of the common income proofs needed for different employment types:
Employed Individuals
3 Months' Payslips: These should clearly show your gross and net income, deductions, and any bonuses or commission.
Bank Statements: Providing 3 months of bank statements can help verify your income and expenditure patterns.
P60: This document summarizes your income and tax deductions for the previous tax year.
Self-Employed Individuals
2 Years' Tax Returns: These documents provide a clear picture of your self-employed income and tax liabilities.
2 Years' Tax Calculations: This includes your Self-Assessment Tax Return (SA302) and Tax Calculation (SA300).
3 Months' Business Bank Statements: These statements should reflect your business income and expenses.
Limited Company Accounts: If you operate a limited company, you'll need to provide the last two years' accounts.
Additional Documentation
In some cases, lenders may require additional documentation, such as:
Proof of Address: Utility bills, council tax bills, or bank statements.
Identification: Passport or driving license.
Proof of Deposit: Bank statements or savings account details.
Tips for Providing Income Proof:
Organise Your Documents: Keep all your documents organized and easily accessible.
Scan and Save Digital Copies: This will make it easier to share documents with your lender or mortgage broker.
Be Honest and Transparent: Provide accurate and truthful information to avoid delays or complications.
Seek Professional Advice: If you have any questions or concerns, consult with a mortgage advisor for guidance.
By understanding the specific income proof requirements and preparing the necessary documents, you can increase your chances of a successful mortgage application.
Other
Rental income – 2 years tax computations and tax overviews
State Pension – Department of Works and Pensions statement, and latest 3 months bank statements
Maintenance – Latest 3 months bank statements may be enough. The Maintenance agreement or if issued, the court order.
Pension tax credits - Department of Works and Pensions statement, and latest 3 months bank statements
Private Pension – Pension statement and latest 3 months bank statements
How to print your tax calculation
1. Log into the HMRC online account (go to www.online.hmrc.gov.uk)
2. Select ‘Self-Assessment’ (if you are only registered for Self-Assessment then you will automatically be directed to this screen)
3. Follow the link ‘View Your Tax Return’
4. Follow the link ‘tax return options’
5. Choose the year from the drop-down menu and click the ‘Go’ button
6. Click the ‘view return’ button
7. Follow the link ‘view calculation’
8. Follow the link ‘view and print your calculation
9. Follow the link at the bottom of the page to ‘print your full calculation’
10. When the print preview comes up, instead of printing you can click the dropdown box and select save as pdf instead (this will depend on the system you are using)
How to print tax year overview
1. Log into the HMRC online account (go to www.online.hmrc.gov.uk)
2. Select ‘Self-Assessment’ (if you are only registered for Self-Assessment then you will automatically be directed to this screen)
3. Follow the link ‘Self-Assessment Overview’
4. Follow the link ‘view account’
5. Follow the link ‘tax years’
6. Choose the year from the drop-down menu and click the ‘Go’ button
YOUR HOME (OR PROPERTY) MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBTS SECURED ON IT.
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