JMC Landlord Accountants
Cambridgeshire is prime for rental property investments, and it is estimated that over 40% of households are privately rented in the county. While potentially very profitable, becoming a landlord has a lot of tax implications.
Investing in tax advice from professional landlord accountants is a wise move to ensure you fulfil your legal obligations to HMRC and operate tax efficiently.
JMC Accountancy is a team of experienced landlord accountants with a firm grasp of buy-to-let property tax. We can take care of your tax and accounting requirements and ensure that your annual property accounts are submitted accurately and on time. We can also take on vital accounting services like bookkeeping.
To find out how we can help drive your buy-to-let profits and save you valuable time, please contact the team at JMC Accountancy.
Why do buy to let landlords need an accountant?
A landlord’s life is a busy one, especially when you own multiple properties. You have many responsibilities, including ongoing property maintenance and the various needs of your tenants. Keeping on top of landlord tax liability and jobs like bookkeeping can feel like one task too many.
That is why many landlords outsource some or all of their accounting requirements to a professional, such as JMC Accountancy. We have a thorough knowledge of landlord tax legislation and can help you to run your business as efficiently as possible. We’ll also ensure you never miss a deadline by filing your annual tax return.
If that sounds good to you, then please get in touch to arrange a free consultation.
What type of landlords do we help?
i.e. those who invest in property with the sole purpose of letting it
Buy-to-let property landlords make up around 42% of the private rental market. Whether you are a first/second-time landlord or a portfolio landlord, we can provide valuable tax and accounting services to suit your personal circumstances.
Second property owners
i.e. those who rent one other property other than their main residence
As a second home owner that rents it out, you are obliged to inform HMRC if you exceed your tax-free allowance of £1,000 and pay tax on profits of over £2,500 (after expenses). We can take the burden of liaising with HMRC and help you to avoid common tax problems.
Furnished holiday let (FHL) landlords
i.e. those who provide short-term holiday lets in furnished accommodation
Whether you are renting your home while abroad or have a portfolio of holiday lets, you are required to register with HMRC and pay tax. We can help you understand your tax advice and understand your obligations as an FHL landlord.
Our landlord accountancy services
Managing property accounts
As your property portfolio grows, it can become very labour-intensive to manage. As part of our landlord accounting services, we can take on the nitty-gritty of property management, including invoicing, accounts receivable and service charges.
We use the most up-to-date accounting software to ensure your rental properties are managed efficiently and accurately, keeping your tenants happy and your finances under control.
Landlord tax returns
All landlords must declare their profits and pay taxes, regardless of their business structure.
- As an individual landlord, you must register with HMRC and pay Income Tax on rental income after your tax-free allowance and expenses.
- If you operate as a partnership, you must submit Partnership Tax returns.
- Limited companies are required to submit Corporation Tax returns.
It’s essential to understand your tax liability, or else you can incur hefty fines and come under the scrutiny of HMRC by way of a tax inspection.
It’s also important to calculate your taxable income correctly to avoid paying too little or too much tax. JMC Accountancy can help you to identify allowable expenses and tax relief and submit your tax return on your behalf.
Landlord tax affairs
There are various taxes a landlord must pay when it comes to buying and letting property, including:
- Stamp duty land tax – if you invest in one property other than your main residence, then you must pay an extra 3% of stamp duty. Rates apply to each additional property you buy, depending on its value and how many properties you own.
- Capital Gains Tax – when selling property, you must pay tax on your gains (i.e. your profit) after your personal allowance of £12,300.
What expenses can a landlord claim?
Letting businesses are akin to limited companies in an accounting sense, and in fact, many landlords choose this as their business structure to make the most of tax reliefs. Like a limited company, an individual landlord is entitled to deduct allowable expenses from their profit in order to reduce their annual tax bill. This includes (but is not limited to):
- Travel – including mileage, motoring costs and overnight accommodation.
- Professional fees – all the more reason to invest in the advice of professional landlord accountants.
- Letting agent fees – the cost of using an agent to market and let a property is tax deductible.
- Repair and maintenance costs – you can only claim revenue expenditure, i.e. the costs of maintaining a property, and NOT capital expenditure, i.e. the cost of improving a property.