10 min read Homeowners and landlords in the UK are facing increased mortgage rates for the first time in a long while, as the Bank of
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accountant for buy-to-let property investors
Run your rental business tax-efficiently and in compliance with the help of Golding Accountancy. Get the right tax advice and support.
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Property taxes that
landlords must know
To thrive as a landlord and stay in the right books of HMRC, you need a qualified accountant to rely on. The good news is – our landlord accountants are here to ensure you don’t overpay taxes, meet all deadlines, and are able to take advantage of the many tax-saving strategies offered by the government.
This is the tax charged whenever you purchase a commercial or residential property.
Reliefs for Buying Residential Property
Where available, multiple dwellings relief (MDR) can offer significant savings. Our team has helped many clients reduce their SDLT bill or reclaim overpaid SDLT by identifying opportunities to claim MDR. We also advise on the application of First Time Buyers’ relief.
Partnerships and Companies
3% Surcharge on Additional Dwellings
This area can be complex and a significant proportion of residential property purchasers require advice on whether the surcharge applies. Our factsheet outlines the rules. However, if you need further advice, please get in touch with us.
Developers and Landowners
Land deals can often result in SDLT charges that are not immediately apparent. Whether it’s deemed consideration, the provision of works, or an overage entitlement, we can help ensure there are no unexpected SDLT liabilities.
1. What is bookkeeping?
Bookkeeping involves recording and organising a company’s financial transactions. It requires staying on top of all day-to-day company expenses and is vital for tax purposes, legal compliance and always having a pulse on the company’s financial health.
2. What does a bookkeeper do?
A bookkeeper is in charge of maintaining and updating all of the company’s transactional accounts. They monitor all incoming and outgoing payments and ensure they’re recorded with due accuracy. They also maintain the reconciliation of the bank accounts. At Golding Accountancy, we’re proud to have a team of seasoned bookkeepers who can help your company achieve the financial prosperity it deserves. Reach out for a chat today to discuss our online bookkeeping services!
This is the tax (usually 20%) charged on the goods and services you utilise on property refurbishments.
As a property investor in the UK, VAT is a crucial aspect to consider, regardless of whether your property is commercial or residential and whether you rent or buy it for sale. You may have basic questions such as how to avoid paying VAT, whether VAT must be paid on rent, or when commercial property is exempt from VAT, but the answers can be complex and dependent on various factors.
VAT has various rates that may apply to property investment businesses, such as the standard rate of 20%, the reduced rate of 5%, the zero rate, and exemption. The following explains the different types of businesses that have various VAT rates applicable:
VAT and residential rentals
VAT on serviced accommodation
VAT on HMO conversion
The conversion of a single occupancy dwelling into a multiple occupancy dwelling (HMO) is eligible for a reduced VAT rate of 5%. To qualify for the reduced rate, planning consent and building control approval must be obtained.
VAT on commercial to residential conversion
VAT on residential conversion (change in the number of dwellings)
When the conversion of a residential property changes the number of dwellings, it qualifies for a reduced rate of VAT at 5%. This applies to qualifying services for residential conversion, for example converting a three-bedroom house into two flats.
VAT on new residential development
Commercial property and VAT
1. How should I minimise VAT on property transactions?
Applying Transfer of Business as a Going Concern transfer of business as a going concern (TOGC) provisions to commercial property purchase from sellers who opted to tax can reduce VAT and SDLT. For residential property development, not registering for VAT if sales are zero-rated, but registering can help claim back input VAT if the property is not for rental purposes. Converting a commercial property into a residential property can eliminate VAT on purchase by filling VAT1614D form. Contact Golding’s landlord accountants for more info.
2. Do I need to charge VAT while selling the whole of my property business?
When selling an entire property business, VAT is not required to be charged (under certain conditions). This type of sale is referred to as TOGC and means that the seller is not responsible for charging VAT on the properties being sold. If you’re confused, get in touch with our landlord accountants.
This is the tax charged when you dispose of your commercial or residential property; set at 10%, 18%, 20%, and 28% depending on the taxable income and the type of asset you’re selling.
The sale of property can be an exciting event. But it’s important to consider the tax implications that come with it. At Golding Accountancy, we offer assistance with Capital Gains Tax to help ensure that the sale of your property doesn’t come with any unexpected financial surprises.
Our services include calculating your Capital Gains Tax liability before you sell, which is crucial information to have. Our landlord accountants can provide you with an estimate of your tax liability and discuss your options to help minimise it. In the event that you have already sold your property and there is tax to pay, we can conduct a CGT calculation and submit a report to HMRC within 60 days of completion of the sale.
Contact our landlord accountants now if you reside in the UK, have a rental property, and are contemplating its sale. We can assist in minimising your tax liability.
1. How do I report and pay CGT?
UK residents are required to report the sale of residential properties and pay Capital Gains Tax within 60 days of completion of the sale, provided there is a tax liability.
2. Can I avoid Capital Gains Tax?
This is a scheme to tax the UK rental income of those residing in a property outside the UK, also known as non-resident landlords. Obligations on the tenant or the letting agent are imposed.
1. What are my obligations as a landlord under the Non-Resident Landlords Scheme?
There are no specific obligations unless you opt to receive the rental income without deduction of tax at source by either your tenant or a letting agency. You can register to receive the rental income without tax being withheld by the tenant or a letting agency if you have never had any UK tax obligation, if your total taxable income for the year is less than the personal allowance for the year, or if there is another reason you are not liable to pay UK tax in that financial year. In these situations, you would simply need to report your rental income and any related expenses by filing a UK self-assessment tax return.
2. What expenses can I offset under the NRLS?
This scheme offers an opportunity for landlords who owe tax to the government through letting out residential property in the UK or abroad to get up-to-date with their tax affairs.
1. What will happen if you should disclose but choose not to?
Residential landlords who have evaded tax are being targeted by HMRC. Using their data on property rentals in the UK and abroad, along with other customer information, HMRC will identify those who may have unpaid taxes. Failure to disclose voluntarily now may result in increased penalties or criminal charges if discovered later.
2. How much is the penalty rate for the Let Property Campaign?
The penalty rate ranges from 0% to 30%. If you failed to register for a Self Assessment tax return but can demonstrate that you did not intend to hide your property rental information from HMRC, you may face a lower penalty of around 10%.
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Prepare HMRC-compliant accounts and tax returns, so you don’t have to. Sit back and let us do the job!
Maximise the tax reliefs, expenses, and deductions you can claim. Why should this business be so stressful?
Strategise the most tax-efficient way to purchase and manage your rental property.
Advise on the investment of your rental income and the best ways to offset your mortgage.
Keep up to date with the latest information for landlords
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