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Landlords Taxing Deadlines

I know the last thing landlords want to be thinking about is tax. Especially when the value of our property investments are falling like a stone and in some places rents now appear to be on the slide.

Where do professional landlords go for their buy-to-let insurance?

Mr Brown how about a tax refund for the loss of value in our property investments!?

Governments are very quick to grab our money when the value of our property investments go up, they are never so generous when values fall – funny that!

This doesn’t obscure the fact that the deadline for the tax year 07 -08 is rapidly approaching.

In fact landlords that wanted to submit a paper return have missed the deadline of the 31st October. A paper return submitted after this date will be automatically liable to a £100 penalty.

Online tax submissions

Landlords looking to submit their tax return online have two deadlines. One is the 30th December for landlords wanting their tax to be collected through their tax code and owe less than £2000. Otherwise where a landlord is happy to pay direct the deadline is 31st January. If it arrives after this date there is an automatic £100 penalty.

Landlords submitting tax returns online

It’s pretty easy to do and allows you to complete the online form in stages and then save and go back at a later date when it all gets too much! In order to be able to submit your tax return online a landlord will need to sign up through the Governments Gateway

Just a little warning for those landlords lucky enough to have any capital gains tax to pay. The online form does not allow a landlord to submit details about their capital gains, therefore it is better to stick to the paper return if this is the case.

Many landlords don’t make a profit on their letting business after taking off the various expenses such as: mortgage interest, letting fees, repairs, etc. However, even if you don’t think you are making a rental profit, a landlord should still submit the details relating to income on land and property. This way they accrue losses
which can then be off set against any future profits.

Should I use an accountant?

Many landlords use accountants to deal with their tax return. In my experience unless a landlord’s business is particularly large or complex then there are few advantages to using one. The downside is that you will be charged several hundreds of pounds for them doing the work. The reality is that you, as the landlord, will have to do much of the leg-work anyway. They will inevitably ask you to put together the figures on: rents received, mortgage interest paid, insurance costs, etc. The result is that you will have done most of the hard work by compiling the figures into a spreadsheet or getting the bills together. All the accountant does is add the figures up and put them in the right boxes. This is really not difficult to do.


Don’t forget if you are using part of your house in connection with running your letting business you can make a deduction for using part of it as an office. If that’s the case, landlords should make a minimum deduction of £104 because this is allowable by the Revenue without them being able to ask for written evidence. Anything above this a landlord will have to potentially evidence. Don’t get greedy, business expenses should be in proportion to the size of a landlords letting business and the HMRC have guidelines as to this and anything above could prompt an enquiry. A landlord should apportion running costs based on floor area say to the use of a bedroom as an office. Costs that can be included: heating, lighting, finance, repairs costs.


For more tips and tax advice have a look at the blog or visit the Landlords Bible


If there are specific tax questions relating to your rental property Property Hawk recommends landlords using the forum on Taxation Web


Save tax – split the rent
Taxing calculations – it’s a doddle

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