Property investors should be thinking about tax planning options as year end approaches (5^th April).

Most tax planning needs to be completed in advance e.g. transfers of assets must be notified to HMRC within 60 days to take effect at the signature date.  This means that investors can only go back around 2 months to backdate asset transfers … not the whole tax year as many investors incorrectly think!

• If property repairs & refurbishment works are needed, get these scheduled in before tax year end.  It doesn’t matter if the invoice is paid, or even received, by tax year end.  If the repair work has been done, or you have incurred the legal liability to pay, it is allowable against THIS year’s income tax bill.  Obviously don’t incur costs just to save tax!

• Consider changing the ownership split for property held jointly with a spouse – HMRC treat all income as taxable 50-50 UNLESS the taxpayer has elected differently!

• Use up your personal allowance and your Basic Rate tax band if possible.  These allowances are lost each year if not used.

• It’s also wise to check your rental losses brought forward from previous tax years.  Often, these can be overlooked, but losses prove useful in future years as profits roll in and no tax is due!

Most investors have a rough idea of their likely rental profits and therefore whether a tax bill is likely, but many fail to act before tax year end.

Talk Stephen to discuss your personal circumstances.

Contact Stephen Fay ACA at Fylde Tax Accountants for specialist advice on all aspects of property tax:

Tel: 01253 350 123
Email: stephenfay@fyldetaxaccountants.co.uk