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Property Articles

Residential landlords – are you aware of the tax benefits of renting furniture & appliances?

First Published: September 2017 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

Traditionally, residential landlords would claim the ‘Wear and Tear Allowance’ when renting residential property – however this allowance was abolished as of April 2016, and replaced with a ‘furniture replacements’ allowance, which is a significantly less generous tax relief. This article looks at the changes made to this aspect of renting residential property, current position, and how renting furniture and appliances can result in a full tax deduction for the cost.

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Strategic re-mortgaging to mitigate ‘Section 24’ mortgage interest relief restrictions

First Published: July 2017 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

‘Section 24’ mortgage interest relief restrictions begin from April 2017, meaning that over the next 4 tax years, mortgage interest will become less and less tax-deductible. Re-mortgaging to reduce mortgage interest relief is an obvious way to reduce the impact of Section 24 – but for many investors, their cash resources are precious and so need to be used wisely – this article explains how strategic re-mortgaging can have a significantly better impact than a more haphazard approach to mortgaging property.
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Converting a property into a HMO? How to save up to 75% of your VAT costs

First Published: May 2017 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

A common property investment strategy is to buy a property and convert it into a HMO. This can be an expensive strategy however, not helped by the 20% VAT charged by suppliers and builders. However, in many cases it is possible to pay up to 75% less VAT for certain ‘qualifying’ conversions.
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Private landlords: will you qualify for a full State Pension?

First Published: March 2017 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

Rental income is not subject to National Insurance, and as entitlement to the State Pension is only possible if National Insurance is paid, this can mean that landlords can miss out on this potentially valuable income stream

This article looks at how State Pension entitlement is achieved, what the State Pension is worth, and how landlords can check their own National Insurance record and make up for any missing entitlement.
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How to transfer a BTL property to an adult child tax-free…

First Published: January 2017 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

Passing on rental property to children tax-efficiently is one of the most commonly-asked queries that we received, especially from older landlords. However, capital gains tax applies to such transfers, and this can make such transfers unviable – however, there is a simple yet effective method to mitigate this issue, via the use of a trust.
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Using a deed of trust to mitigate the impact of Section 24 and save tax

First Published: November 2016 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

The forthcoming mortgage interest relief restrictions – starting in tax year 2018 – mean that for many landlords there is a substantial benefit in re-structuring the beneficial ownership of their portfolio, through the judicious use of a ‘deed of trust’ (DOT), in order to make full use of spousal and family Basic Rate tax bands. But what is a deed of trust exactly, why are they beneficial, and how are they properly put into practice?
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Your home IS an asset – Kiyosaki was WRONG!

First Published: September 2016 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

In my experience, many property investors neglect their own home as a key part of their property asset base, which can be a serious wealth-building mistake. The ‘Rich Dad Poor Dad’ books – written by Robert Kiyosaki – make the case that your home is a liability rather than an asset – in this article, I make the case is made that the opposite is true (sorry Robert! – although I do still generally agree with your focus on income – or ‘putting cash in your pocket’ views).

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Should I incorporate my BTL portfolio?

First Published: July 2016 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

Many property investors are considering the option of incorporating their BTL portfolio to avoid the mortgage interest relief restrictions that are starting from tax year 2018 – as these new tax relief restrictions don’t apply to companies. However, there are a tax and finance challenges, which make the decision not as straightforward as many landlords believe.

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General Anti-Abuse Rule (GAAR) – what it is and why it’s important to property investors

First Published: May 2016 | Available in: Property Articles Your Property Network

By specialist property accountant Stephen Fay ACA

Many property investors are facing an increasingly challenging tax regime, following the Finance Act 2015 – restricting residential mortgage interest relief – which has received Royal Assent. There is now an added incentive for property investors to become more ‘creative’ with their financial affairs – however it is important to stay on the right side of the law. This article explains what the UK’s General Anti-Abuse Rule (GAAR) is, how it affects property investors, and how to ensure compliance with it.
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