tax on buy to let

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    tax on buy to let

    hi can anyone help i am buying new house should be done in a few weeks. i need to know how much tax i will have to pay and how i do it.
    i work full time so i pay normal tax on my earnings.
    i will be renting house for £600pm. will have repayent mortgage of £316 for 25yrs
    i wiill doing some work on house myself eg. re-painting and any minor repairs.
    i will get buildings and gas safety done.
    i need your help on this thanks

    #2
    If you are not currently registered for a self-assessment tax return, you'll need to register if your rental profit is more than £2500 in a year. You can do that on the HMRC website. It's very easy.

    Other than that, it'd be a good idea to read a general guide on income tax for landlords as soon as possible. Property Hawk has a good concise one, and this website also has various tax articles although they are a bit diffuse. There is loads more available on the internet though, and some good books are about.

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      #3
      thanks james i will look at HMRC website and see how i register for self-assessment and look at propert hawk maybe

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        #4
        "look at property hawk maybe". It's not a maybe it's essential as you have a lot to learn.
        For instance you mention a repayment mortgage, be aware it is only the 'interest' that is deductible.
        You will need to register no matter how much profit you make. The comment about £2,500 only applies to owners with no other income. Regards Peter

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          #5
          thanks james yes i have alot to learn. I have been on property hawk and i am making notes from there about all i can claim for even paper and printer ink.. so much to take in, this is a very helpful site . Thanks for the informaition. I did know that only the interest part of my loan is deductible. when i get property i will keep all the bills i will have to pay. eg council tax, gas elec, water, estate fees to let, insur, gas saefty check. see i am learning

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            #6
            Is it a Buy to Let Mortgage you have or a residential mortgage and you have permission form the lender to rent the property out.
            Regards Peter

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              #7
              yes peter it is a buy to let mortgage but i have another problem i have another property that i am using as my deposit and am re mortgaging it i have been renting out for a long time but i,ve never informed income tax about it. so now i dont know what to do. any help you can give thanks peter

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                #8
                Originally posted by graham s View Post
                yes peter it is a buy to let mortgage but i have another problem i have another property that i am using as my deposit and am re mortgaging it i have been renting out for a long time but i,ve never informed income tax about it. so now i dont know what to do. any help you can give thanks peter
                If you want to get on the right side of the law, you'll need to disclose this to HMRC. Be warned that there may be some penalty to pay, but it might be less than you think....

                You may wish to see the ongoing let property campaign from HMRC:
                https://www.gov.uk/government/public...g-a-disclosure

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                  #9
                  You can only claim the interest up to the value of the property when first let. What is a long time. ? What profit have you made. You need to disclose this to HMRC before they uncover you. Regards Peter

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                    #10
                    hmm well i bought property in 1999 with my then wife for 48,000 then in 2002 divorced and then rented it out but have had many tenants mostly bad ones. i had one tenant that i had to take to court with a loss of 5,500 rent over the two years and court costs but did have good tenant there for about 2 years who paid rent of 500pm. i did go back to live there in 2010 after another tenant left it in a total mess. my problem being how would i work all this out from 2002 dont know what to do. my current tenant owes me £2,800

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                      #11
                      Originally posted by graham s View Post
                      how would i work all this out from 2002
                      Well, if HMRC cotton on, they will certainly work it out for you, if necessary just by wild guesswork in their favour, which will stick if you can't come up with something better. What records do you actually have?

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                        #12
                        More on the HMRC Let Property Campaign for your interest

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                          #13
                          thanks for your reply found your letter from hmrc interesting thanks. Have not much paper records been trying to remember all tenants i,ve had over the years but this is only from memory. maybe i will have to go thro bank records if i can go back 15 years oh dear.

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