Cutting Rental Income Tax Liability

PJGILL

Hello All, I have three interst Only mortgages that i recieve rental income on. Because of the recent changes in interest rates i am now recieving substantially more in rent than i am paying in Interest. Does anyone know the best way of avoiding a large tax bill next year for the extra income? Thanks

fengirl_2

We dont do tax avoidance on this forum.
Make sure that you keep an accurate record of all your property outgoings and that these are included on your self assessment. MAke sure you bring forward all your losses from previous years, if any.

Pennywise

You can deduct property repairs and maintenance from your rental income. If you spend your mortgage savings on things like redecorating, roof repairs, general maintenance, etc., it is a valid expense and your tax will be less accordingly. You can also do some "improvements" that would also be classed as repairs & maintenance, i.e. replacing single glazed windows and doors with double-glazed, or replacing kitchen and bathrooms, replacing central heating systems etc - just make sure that you replace on a like for like basis - if you add something that wasn't there before, i.e. additional kitchen units, shower cubicle, extra bathroom, more radiators, extension, conservatory, etc., then it's improvements and not a deduction as repairs & maintenance.