Tax Calculation

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Tax Calculation

    Based on the below figures (no other income), am I correct in saying I should fall within the 20% tax bracket?

    If gross rental income is £58k,
    Maintenance/Repairs/Managing Agent = £16k
    Finance Interest = £17k

    Personal Tax Allowance £12500




    #2
    Yes.

    The gross income = £58K less £16K maintenance expense

    = £42K less loan interest 20% x £17K ( £3.4K)

    = £38.6K less £12.5K personal allowance

    = £26K @ 20% = £5.2K tax.

    Comment

    Latest Activity

    Collapse

    • Switching mortgage to BTL and tax implications
      by dotcotton999
      Evening all,

      I am currently looking to move house and also have a rental property that has around £200k equity in it.

      The rental house had consent to let and on a repayment mortgage and has 3 years to go until I can switch deals.

      I have spoken to a mortgage broker...
      08-04-2021, 19:52 PM
    • Reply to Switching mortgage to BTL and tax implications
      by Gordon999
      D999,

      The taxman's method of calculating :

      Capital gain is the Sale Price ( say £200K ) minus Purchase Price ( say £130K ) = £70K capital gain.

      But buying and selling expenses are allowable and include the conveyancing cost : say £1K plus estate agent'...
      12-04-2021, 14:17 PM
    • CGT and tax returns
      by Lots on
      Hello all, just need some advice re CGT. I have a house which I refurbished entirely, mostly in this financial year and I could start my tax returns on the 6th of April 2021. I spent nearly £30000. New kitchen and bathroom, re doing the garden, new flooring throughout ,total electrical re wire, re...
      02-04-2021, 09:46 AM
    • Reply to CGT and tax returns
      by Lots on
      Thank you for your kind words JP and the tips re using an accountant. Having been taxed at source all my working life this is very useful information. I will look round for an accountant. A friend of mine who is also a landlord as well as having a day job has one, so maybe a personal recommendation...
      12-04-2021, 10:04 AM
    • Reply to CGT and tax returns
      by jpkeates
      Thank you for your work in the NHS!

      I've found that the first sessions were the most valuable in terms of what could be saved, and the value has diminished slightly and the costs of the returns being done has stayed the same/slightly increased, so it feels like it's less worth it.
      ...
      12-04-2021, 08:28 AM
    • Reply to spreadsheet
      by jpkeates
      I use one page of a spreadsheet for all the income and expenses and have other pages which automatically summarise the data property by property.
      12-04-2021, 08:24 AM
    • spreadsheet
      by jase222
      I been looking at spreadsheets to list my expenses and every template I find seems to allocate expenses per house ie 5 houses = 5 separate sheets whereas I just put everything down on one sheet.
      I would like to know if I have been doing it wrong all these years.
      ​​​​​​Any help...
      11-04-2021, 13:53 PM
    • Reply to Switching mortgage to BTL and tax implications
      by jpkeates
      When you sell the property, you can't retain any of the equity, so that doesn't really make any sense to me.
      On disposal, the mortgage will end and have to be repaid.

      The value of the rental property when first let is also a limit to the amount of the loan against which interest can...
      12-04-2021, 08:22 AM
    • Reply to Switching mortgage to BTL and tax implications
      by dotcotton999
      Gordon999 thanks for your reply. In regards to CGT so if I was due to sell a house I could request to remove all the equity before the sale and wouldn’t be subject to CGT... that doesn’t seem right.

      In regards to switching my mortgage from repayment to and interest only... would I incur...
      11-04-2021, 19:31 PM
    • Reply to spreadsheet
      by Gordon999
      Its good to keep a separate sheet for each property because when you come to sell one house , you may want to show the rental and expenses records for one house to prospective buyers.
      11-04-2021, 19:08 PM
    Working...
    X