Tag Archives for " UK Property Tax "

UK Property Tax

What is the UK property tax when an investor buys and sells

Sector growth should underpin profits for property investors

When you invest in property UK, one thing you can be certain of is that the taxman will want a cut. There are some strategies that can be used to reduce the effects of UK property tax changes when making a buy-to-let investment. If you are buying to flip the property (sell shortly after the purchase for a capital gain), your tax saving options are more limited. Read More

Investment News – UK Property Tax: What to do next…

These UK property tax changes are undoubtedly a big shakeup of the buy-to-let market.

This said, as a property investor you will still benefit from the majority of the deductibles that were available this time last year to reduce your rental income and tax bill for your property investment. For new investors or those expanding their property portfolio, the extra stamp duty is a chore and a bore as well as an extra cost that you could do without – but it is a known factor, and so one that can be considered and strategized for before investing. And this goes for the way in which wear and tear costs are now handled. Read More

UK Property Tax: Are property investors right to be worried?

Changes to UK property tax are increasingly targeting buy-to-let investors.

Sir Jon Cunliffe, a deputy governor at the Bank of England, has consistently warned over the last year that the rise in property ownership by private landlords threatens the stability of the UK economy. His major concern is that an army of buy-to-let investors will sell en-masse in reaction to tax changes or rising interest rates that crush landlord profits. If this happens, he predicts a “spiral of house declines”.
  • Today, one in five of all mortgages is a buy-to-let mortgage
  • Approaching 25% of all homes are buy-to-let properties
Read More

Investment News – UK Property Tax: How mortgage interest tax relief is changing

From April 2017, the way in which tax relief on mortgage interest is calculated is going to alter.

Up until now, you have been able to offset your mortgage interest, as an allowable expense, against the income you earn on the property investment. In fact, most accounting standards and countries around the world adhere to this simple premise. As a property investor, you’ll owe tax on the entire rental income less the allowable expenses. Read More

Investment News – UK Property Tax: The tax rules that are changing

New rules for wear and tear

Before April 2016, if a buy-to-let landlord leased property to a tenant as fully-furnished the landlord could automatically claim an amount against rental income as wear and tear. This was set at 10% of the rent received. After April 2016, all landlords will be able to deduct the costs of replacing furniture. So the good news is that this deductibility of costs has been extended to include landlords of unfurnished and partly furnished homes. The bad news is that deduction is no longer automatic and that claims are limited to replacement of items that are provided for the use of the tenant. Such items include: Read More

UK Property Tax: Calculating Your Capital Gains Tax Liability

Capital Gains Tax (CGT)

Its important to view a range of investment guides at all stages of a property investment. CGT is payable when you dispose of an asset and make a profit on it. Most commonly we think of disposal as being the sale of the asset, but disposal also includes:
  • Gifting it
  • Transferring it to someone else
  • Exchanging it for something else
  • Being paid on an insurance claim if it has been destroyed
(It’s worth noting here that if you transfer your investment property to your spouse, then the disposal is assumed to have taken place at the original cost and so no CGT will be payable until your spouse sells the property.) Read More