Letting agents fees and VAT being charged to Landlord

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    Letting agents fees and VAT being charged to Landlord

    Hello.

    I have a small flat (2 bed), which I am thinking of renting out while I am abroad. I will be out of the country for a few years and non-resident for tax purposes. I assume it would be on the usual tenancy agreements (but most of that will be up to the agent).

    Having looked on the web, I think I can place my flat with a letting agent and would get around £650 per month rent for it.

    I have tried to shop around for lettings agents. Non of them are willing to discuss actual charges with me, but one did offer to do it for a fee of 8% plus VAT - together with VAT added to all services provided through them by a third party.

    Does anyone one know if this sounds reasonable?

    What is the position on VAT if I am non-resident?

    Can the agent charge me VAT for other services (e.g Gas Check) which are provided by a third party but are organised by the agent?

    If I organise these things myself, would I still need to pay the letting agent VAT?

    Many thanks - I will be glad to hear any ideas, input and thoughts.

    #2
    Depending on where you are 8% plus VAT is not bad at all.
    They'll charge VAT on everything they do for you (they have to).
    You can arrange things with tradespeople directly who won't charge you VAT.
    The VAT element is allowable as an expense against your income.
    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


      #3
      Tbh, I think 8% sounds too cheap! I would drill down a bit and find out what that includes. If you're abroad you want as close to full management as agents will give, although you should be aware that some things you may not or should not be able to hand-over responsibility for (eg Right to Rent checks, ensuring the deposit is properly protected and PI served etc, basically anything that could end up costing you a lot of money or giving you a criminal record).

      Also don't forget to let HMRC know that you will be a landlord living abroad.

      Comment


        #4
        Originally posted by DPT57 View Post
        Tbh, I think 8% sounds too cheap!
        8%+vat is pretty standard if the property is outside of London, though really they should be quoting inclusive of VAT now. We, in Manchester, are 10% including VAT, if that's any help.
        <a href="http://www.manchesterpropertygroup.co.uk/" target="_blank">Manchester letting agents</a>

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