Top Ten Tax Tips for Landlords

Richard Grayson from Nicholsons Chartered Accountants gives us his top tax tips

Top Ten Tax Tips for Landlords

  1. Keep detailed records of your annual income and expenditure for your property rental business
  2. Claim all costs of running the property rental business, including mileage/travel costs if you physically collect the rents
  3. Consider operating your property rental business through a limited company, as tax rates may be lower
  4. Keep details of all capital costs of acquiring properties, such as legal fees, SDLT etc., as they will be needed when the property is sold
  5. If you have lived in the property for any period of ownership, document the dates so that exemptions can be claimed when the property is sold
  6. Bear in mind the extra 3% SDLT on any property purchase that is not your main residence
  7. Consider transferring properties to trusts as a way of passing on wealth to the next generation in a tax-efficient way
  8. If married or in a civil partnership, you may want to put properties into joint names, and make an election to vary the property ownership, and therefore the property income, from the standard 50/50 split to reduce your joint tax bill
  9. Beware that gifts of property to anyone other than your spouse could cause a Capital Gains Tax liability
  10. When selling a property, make sure you make best use of all annual allowances and basic rate tax bands, and those of your spouse/civil partner.

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