Land and Property

If you have a rental income, you have a legal obligation to report this activity to HM Revenue and Customs.

You must declare computed profits or losses in your annual tax return.

From the 6 April 2020, tax relief for finance costs (including mortgage interest) will no longer be an allowable deduction against rental income but instead a 20% income tax reduction will be given.

These rules only apply to individual landlords owning residential property and not to companies, commercial properties and furnished holiday lets.

If you have several properties, you may have to consider restructuring your portfolio to help reduce your ongoing tax liabilities.

Here is how we can help you:

• Implement the incorporation of your portfolio to minimize your increasing tax liabilities.
• Advise on making the most beneficial decision when electing your main residence in the UK, which has strict deadlines on reporting to HM Revenue and Customs.
• Tax efficient advice to help minimise any Capital Gains Tax (CGT) applicable on the sale of a property or holiday home, which is required to be declared on your annual tax return.
• Ensure you are correctly claiming for all expenses, reliefs, finance costs for any loans or mortgages allowing you to optimise your tax position, depending on your circumstances.
• Advise you on the qualifying conditions and the implications of operating Furnished Holiday Lets (FHLs) and assess the benefits based on your circumstances.
• Ensure you are compliant with the conditions if applying for an exemption on renting out rooms in your house where the total rents do not exceed £7,500 per year.

Being a landlord does not come without its challenges and if not strategically planned from the outset can prove to be costly.

Nevertheless, we are on hand to support you through your ongoing journey of climbing the property ladder from buying, selling to letting.

Our experienced team can put your mind at ease and provide you with that life changing advice to ensure you optimise your assets and minimise your tax liabilities.