Claim allowance using car for BTL

stphnstevey

I have read that I can claim a 'proportion' of the:

a) Cost of buying
b) Fuel costs

of a car when using it relating to BTL properties. I believe this is a % based on how much you actualy use the vehicle. My properties are NOT held within a company.

Is this correct? Does anyone else do this? If so, what % is seen as appropriate?

dougk_2

My guess is you should use a "milage allowance". This milage allowances covers wear and tear, running costs etc not just fuel.
As an employee you are allowed a rate of 40p per mile up to 10,000 miles and then 25p a mile thereafter free of tax for a normal car (motorcycle and cycle rates are different).

I would therefore use 40p a mile to base your costs on, but a call to the HMRC would probably be best.

regularsaver1

What has the car got to do with the BTL property?

dougk_2

If you travel to your property to do work, inspect the house, talk to your tenants, see your letting agent etc etc the cost of using the car for this purpose is a sort of Business expense - similar to that of you using a car to do your job for a company you work for.

regularsaver1

thats sounds quite good

i knew you could discount any home improvements ect

dougk_2

From what I remember from the last self assessment guidence form i read any other expenses involved can also be claimed so letters (paper, envelopes and stamps) , telephone calls, cost of post redirection (if you lived in the house to start with), costs of insurances, interest on mortgage payments, finance costs etc.

Basically anything that can be classed as the HMRC says is "any cost you incur for the sole purpose of earning business profits"

Angela_D_3

dougk wrote:

If you travel to your property to do work, inspect the house, talk to your tenants, see your letting agent etc etc the cost of using the car for this purpose is a sort of Business expense - similar to that of you using a car to do your job for a company you work for.

!!!!!! the sooner you lot are taxed into oblivion the better. I would bet my hat he owns a 4x4.

Alan_M_2

BTL is like any other business, you claim reasonable operating expenses against income. Just don't be tempted to take the pee, there will be certain parameters into which you should fall, if you exceed these you'll be inspected, and trust me you don't want that.

However, before you start claiming, be very very sure you are declaring everything you earn or you'll open a can of worms you wish you'd never had.

As for Angela's post, well that's quite the most naive view I've ever come across.

david29dpo

I agree, what is the meaning of that? I claim as much as i can, who wouldn't.

dougk_2

Alan_M wrote:

As for Angela's post, well that's quite the most naive view I've ever come across.

Plus sour grapes I think.

A business is a business. The idea of a business is to make money. To make money you maximise income and minimise outgoings.

I think it is also fair to say that if BTL's and LL's are taxed more heavily that the costs of rental accomodation will rise so who gains there? My view is teh cost of renting is currently kept lower due to the number of BTL's and choice and availability. Less BTL properties = less choice, less availability and more demand. We also see what demand is doing to house prices so the same effect would happen to rental prices.

Are we now saying that builders and developers should not be allowed to make money out of building homes?

If you are running something not to make money you are a charity.

abaxas

Just to confirm...

BTL is a BUSINESS!

Hence you would have to keep records for 5 years or risk the wrath of the IR.

Get an accountant / tax adviser. This is usually the best investment anyone can EVER make. Keep everything in order, the IR might draw your name out of the hat! Tax investigation are NOT a pleasant thing.