The Dreaded Tenant Tax And What You Can Do To Save Money
- Posted by Nellie van der Walt in blog, Tips & Advice
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With tax returns handed in, a lot of landlords are sitting with their hands in their hair because of the sky-high taxes they had to pay. And it’s only going to get worse!
Why are the taxes increasing so dramatically?
A little piece of legislation called Section 24 was introduced in April 2017 and is phasing in over the 4 years. For landlords with properties, this means that you won’t be able to claim mortgage interest, or any other property finance, as tax deductible.
Rather, rental profit will be taxed with a maximum deduction for finance costs of 20%, the basic tax rate, by 2021.
How we are helping our Landlords
At the end of April every year we issue a self assessment tax form. This compiles all of the information we need for the taxman about your rental property.
Most agencies charge for this service. Sometimes they charge per landlord and even per property sometimes. This can be anything from £50-£150 + VAT.
Now, since you’re already paying higher tax, it seems unfair that you should pay more on both council and agents.
Luscombe & Co’s team does all the hard work for you, so you don’t have to do any. And we offer you this service completely FREE of charge!
We’ll be giving you more critical tips in our following blog posts on how you can restructure and avoid hefty tax bills, so stay tuned!
In the meantime, if you have any questions, do not hesitate to contact us on 01633 265 222 or email: [email protected]