Becoming landlords for the first time this summer - tax advice

  • Filter
  • Time
  • Show
Clear All
new posts

    Becoming landlords for the first time this summer - tax advice

    This summer, probably July 2018, we intend to rent out our three bedroom home and move a few miles down the road to the next town. We will rent a flat or house ourselves. We want to be within the catchment area of a better state school for our child than what is on offer where we currenty live. We may be able to move back to our own home again a few years into the future. So we’re not in a buy to let situation - becoming landlords and renting ourselves.
    We have a flexible offset mortgage with a balance hovering just above zero but we can withdraw money at any time and start paying interest again or indeed pay off the mortgage completely and be done with it. Currently the mortgage is in my name only (the husband), I am a higher tax rate payer, my wife is a homemaker with an income of less than £2,000 per annum. I’m happy to change the mortgage so the house is in joint names. We want to use the income from renting out our home to help pay the rent we will have to pay ourselves. Could anyone advise the most tax efficient way to go about doing this?

    Hi, to split income/expenditure understand you both need to be on the deeds. However current mortgage provider may not allow this, also you will need permission to let from them, which they might not give with your current product.
    Best to give them a call, and discuss options with them.


      or pay it off or take out a BTL mortgage on it in joint names, as tenants in common, then utilise your wifes tax allowance to offset the interest ?


        You need to sit down with an accountant / tax expert and talk through the options.
        The alternative is to do a lot of research and planning - it isn't something to be taken in lightly.

        Being a landlord is running a business, and letting your own home is one of the more stressful ways to go.
        Tenants won't treat your property as you would, and it's very difficult to keep focussed on the business aspect (particularly if you intend to move back in later).

        And check our ground one of section 8 notices.
        When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
        Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).


        Latest Activity


        • Subsistence costs - can my limited company pay for me?
          I'm going to make an overnight trip to another city wholly and exclusively for the purpose of doing some work in relation to my rental properties, which are owned in a limited company.

          I am already treating my train fare and hotel cost as a business expense, paid for by the company, but...
          21-08-2018, 20:28 PM
        • Question regarding upgrades in flat for tax relief
          Im unsure as to what i can claim tax relief on. I have to replace a gas boiler as the current one isnt working properly, can i claim relief on this ? im also a registered heating engineer so doing the work myself purely material costs.

          Is there a way i could invoice my property...
          05-08-2018, 13:03 PM
        • Reply to Question regarding upgrades in flat for tax relief
          HMRC don't allow landlords to claim for their own labour against income for tax.
          Landlords are expected to do work on their investment as part of their business activity.

          That may be different in Scotland.
          21-08-2018, 12:20 PM
        • Move to ltd company
          I read a lot about changing to a ltd company, at which point or why should this be done. I currently have 2 BTL and in the process of buying my third with a fourth on the cards for end of year or early next year. What is the best advice for this.

          I am a tax free resident so...
          06-08-2018, 09:41 AM
        • Reply to Move to ltd company
          You can't offset the repayment element of a mortgage against income (as an individual) - at least not in England, Scottish rules might be different.
          The position as a limited company would be slightly different, but not that much.
          21-08-2018, 12:04 PM
        • Reply to Question regarding upgrades in flat for tax relief
          Well if it’s tax deductible then say I pay £1k for a boiler then my profit at end of year would be £1k less so wouldn’t pay tax on that amount....
          21-08-2018, 09:42 AM
        • Reply to Move to ltd company
          I’m talking about profit after mortgage and other payments are made., ie insurance, boiler contract etc. They are both on repayment mortgages so less monthly profit than interest only....
          21-08-2018, 09:39 AM
        • Seeking a professional tax expert please
          Fed-up of all the attacks on the BTL sector by the government and the ever-increasing red tape and hassles of managing tenants, so I'm looking to sell my portfolio of UK BTL properties and invest a fairly large sum into equities etc. from which to receive an annual 'retirement' income.

          20-08-2018, 12:26 PM
        • Let Property Campaign and past experience
          The ex-wife and I had a couple of rental properties which we've rented out for the past 2.5 years. The initial intention was to use the properties as an investment for the future, but we divorced after a year and never put our tax affairs in order. After the divorce, I wanted to declare the...
          17-08-2018, 16:19 PM
        • Reply to Let Property Campaign and past experience
          I expect both you and ex-wife have to submit tax return for rental profit for 2016/2017 and 2017/2018 ( since you started letting 2.5 years ago and current year end profit cannot yet be computed ) .
          So from the letting records of each property and for each year , you calculate the...
          19-08-2018, 11:08 AM