1st time BTL advice

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    1st time BTL advice

    Hi all,

    Anyone noticing how surveyors seem incredibly cautious at this moment despite a high demand market! Had quite a few de-valuations and basically was wondering the below as now need to increase deposit to a further 19k.


    Own a main home in my name. which most likely will want to sell in around 3 years after 5 years current mortgage needs to be reviewed. It will have 13 years left remaining to pay off by that point, and hopefully the market remains stable at least. I don't get attached to properties.

    I am in the process of investing in my 1st BTL, and will have to pay stamp duty...if I sell my main home in 3 years fine can claim that back but say the market remains futile, is there recommendation I add my boyfriend on the deeds of my BTL (he doesn't own any homes). On top of this, I don't want to put the BTL property with an agency because I have experience of managing family rental homes, can I hire myself at a fair hourly rate to basically take care of my tenants and home? So I will do the cleaning, fixing small fixtures when required, and use a family builder to conduct serious repairs. Assuming I will need to open a VAT number to be able to hire myself. I don't see a problem with this but can see how some others would of exploited things.

    Thank you for your advise, since a teenager I have been so interested in the landlord life and I hope by 30 I can take up a few more porfolio's, at first wanting mainly being interested in introducing people to their 'potential future homes' and seeing others content and not worrying about landlords who are all about just for the cash. However, right now paying high legal fees via stamp duty and then when it comes to selling on...obviously are a thought.


    #2
    You really should consult an accountant and as for paying "yourself" - that isn't probably a good idea

    When working out your numbers - how many empty weeks per year have you allowed for?

    Comment


      #3
      It won't make any difference to the SDLT position if your boyfriend is on the deeds or not.
      As long as you are involved and own a property already it triggers the higher rate.

      As a landlord, you can't pay yourself for the work that you do and reduce your tax paid as a consequence.
      You're being paid for the work in the form of rent.

      You don't want to register for VAT as a landlord if you can help it.
      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).

      Comment


        #4
        1. Your rental profit ( which is the " 12 months rental income" minus "allowable expenses" ) is your income . So the tax office does not allow you to pay yourself from your own income.

        2. Businesses with annual turnover exceeding £85K have to register for VAT and charge 20% tax on supply to customers. Your BTL property is residential property and not required to register for VAT. So don't put yourself into VAT registration because you will have difficulty finding a rental tenant.

        3. I hope you realise that there is no cgt to pay on capital gains from your own residence . But capital gains from BTL property is taxed at 18% or 28%.

        Comment


          #5
          Originally posted by Gordon999 View Post
          1. Your rental profit ( which is the " 12 months rental income" minus "allowable expenses" ) is your income . So the tax office does not allow you to pay yourself from your own income.

          2. Businesses with annual turnover exceeding £85K have to register for VAT and charge 20% tax on supply to customers. Your BTL property is residential property and not required to register for VAT. So don't put yourself into VAT registration because you will have difficulty finding a rental tenant.

          3. I hope you realise that there is no cgt to pay on capital gains from your own residence . But capital gains from BTL property is taxed at 18% or 28%.


          Thanks all for your feedback, yes so the goal was with this BTL to have my name and my partners name and in the long run at some point if there's a chance he isn't interested in buying a home himself to just remove my name and have his name only on the property and for a few days month use it and sell at the 18% rate.

          I guess I can look at a family member or training my partner on how to assist overlook the property as I am experienced enough and will care more to do checks the way I want to rather than hire an agency.

          Comment

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