Property Tax Planning for Landlords

Tax Planning for Landlords

Services

Rental Property Tax Planning

Defining property tax

If you rent out a property, you may owe property tax. Earnings from property renting are handled like any other source of income, except the first £1,000 is tax-free. After this level, the income tax rate applies.

Other landlord taxes may apply. If you manage a property company and earn more than £5,965, you must pay ‘class 2’ national insurance (NICs). If you buy a second house or buy-to-let investment, you’ll pay an extra 3% in SDLT. If you’re a landlord and sell a property that isn’t your primary residence but has appreciated in value, you’ll owe capital gains tax.

*Note that the information above applies to property rentals, not hosting at a private house (Rent-a-Room Scheme), for which other restrictions apply.

How can we help?

Complex and ever-changing, property taxes. A professional accountant or tax consultant can keep you informed of current or forthcoming developments and help you maximise reliefs and allowed costs. Taxsteins Ltd clients:

Stay current on legislation

George Osborne announced intentions to reduce landlord tax relief in the Summer 2015 Budget to provide a “fair playing field for those purchasing a property to lease and those buying a home to live in.”

These modifications restricted the amount of costs that may be subtracted from property revenue to calculate profits. New property tax plan established in stages:

In 2017-2018, landlords may deduct 75 percent of financing expenses and get a 25 percent basic rate tax cut.
2018-2019: landlords may deduct 50% of loan expenses; the other 50% is a basic rate tax decrease.
2018-2019: landlords may deduct 25 of loan expenses and get 75 as a basic rate tax reduction.
2020-2021: 100 percent financing expenses will be tax-free.

As your advisors, we’ll monitor these and any future changes to relief and taxes to decrease your landlord tax exposure.

Reduce the amount of tax payable by:

Reduce tax by using all reliefs. You may claim income tax reliefs or the new ‘domestic items’ relief (which replaces ‘wear and tear’).

Determine ‘allowable’ expenditures. Many of the expenditures required by day-to-day landlord tasks may be deducted from earnings, lowering your property tax. Legal fees (up to a year), building and contents insurance, cleaning and gardening services, and regular company charges like ads or stationery. We’ll manage your accounts to reflect your expenses.
Advising on non-allowable costs, such as mortgage payment elements and personal expenses (such as telephone calls not related to the business).

Unexpected property tax payments are a landlord’s worst nightmare. If you hire a TAXSTEINS & Co chartered certified accountant, we’ll make sure your company is successful, pleasurable, and tax-free. Contact TAXSTEINS Ltd to learn more about our services or to schedule a meeting at 02071559545 or email info@taxsteins.co.uk

Tax Planning for Landlords

Services

Rental Property Tax Planning

Defining property tax

How can we help?

Reduce the amount of tax payable by:

Get In Touch!

Consultation With Qualified Tax Advisors and proficient accountants

Sign up to
Get Latest Updates

Business Hours

Tax Planning for Landlords

Services

Rental Property Tax Planning

Defining property tax

How can we help?

Reduce the amount of tax payable by:

Get In Touch!

Consultation With Qualified Tax Advisors and proficient accountants

Sign up to Get Latest Updates

Business Hours

Sign up to
Get Latest Updates