In this week’s #ExpertView, Kate Faulkner, Founder of propertychecklists.com, discusses the advantages of using an independent property tax specialist to help with landlord tax administration.
It’s very easy at this time of year to think tax deadlines are a long way away, but suddenly it’ll be October and then December and January deadlines will be around the corner.
Some years ago, after many mad dashes with critical paperwork to get my company accounts sorted and nervous moments hoping the government online self-assessment portal wouldn’t fail, I decided the best time to get everything done was April. I also decided to stop doing the accounts myself – and pay someone to do it instead.
It’s easy to get into the habit of doing your own taxation each year and treating it as an administration exercise. However, with so many changes to taxation rules for landlords over the last few years, and more to come, it may well be better to opt for some professional help in checking your tax and seeing how you can plan and run your finances better.
An independent property tax specialist can help you correctly interpret new rules and how they affect your personal circumstances, such as the restrictions on finance relief for landlords (Section 24), the loss of the annual wear and tear allowance and making tax digital – depending on whether you operate as a business, and the turnover.
Although initially it can be a bit daunting to hand over responsibility of your tax to someone else, it’s a worthwhile exercise and means your family is covered should the worst happen. However, you will need to collate a lot of information about the property or properties you own including how much you paid for them (including the stamp duty), if any of the properties were your main residence, the purchase and sales fees, capital expenditure, and the current values and any outstanding loans.
In addition, it’s important to remember that property isn’t taxed ‘separately’ to the rest of your income and assets so you will need provide that information too.
If you can, either get your tax done early this year yourself, making sure you are up to date with all the changes or, work with a professional who may help to reduce your tax bill – and if not, at least the stress and hassle of dealing with taxation deadlines will be significantly less.
For more about property tax, visit https://www.propertychecklists.co.uk/articles/Buy-to-Let-Tax
Kate Faulkner is a recognised property industry expert and runs propertychecklists.co.uk, a consumer advice website providing insight and expertise. She also runs consultancy Designs on Property Ltd. which provides support to companies and organisations that want to communicate better to the public or to introduce new products and services to the property sector.
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