Rental property savings

Cherryjack

Hello,

Just wanted to ask some advice really :-) hope you can point me in the right direction..i have a rental property.. and i will be having the tax worked out next april/may after the p60..
What should i do with any profits? i think i would be making about 5000 or more a year....not sure what the best move is...

Thanks for reading and giving any help :beer::money:

Cherryjack

Bump ..............:-)

nrsql

I take it you don't have a company to run this through?
Get an interest earning account with the same institution so you can move money quickly.
How much cash you need to keep on instant access depends on your situation - how much do you have outside this account for emergencies, what would you do if you stopped getting rent for 4-5 months. I would keep at least £2k accessible. After than treat it like your personal savings - there's no need to keep it separate as long as you keep records - which would be movements from the rental account.

Cherryjack

Thank you thats great :-) i will set one up when the time is ready.. at the moment the money is just building up in a second current account
No company..

slopemaster

I use a Lloyds TSB Classic Vantage a/c which works as a current a/c (debit card, DDs etc) but pays interest on up to £5000. Then just cream off anything above that and put in a deposit a/c

Cherryjack

slopemaster wrote: »

I use a Lloyds TSB Classic Vantage a/c which works as a current a/c (debit card, DDs etc) but pays interest on up to £5000. Then just cream off anything above that and put in a deposit a/c

Thank you :-)
im not sure about Isa's ive not used mine before do you pay your max into that first?:money:

atush

If you pay tax, put the part of the money you will not need for emergencies into an ISA rather than aregualr savings. then each year open a new one for the new profits.

Keep back enough cash for void periods, repairs/maintence and taxes.

Cherryjack

atush wrote: »

If you pay tax, put the part of the money you will not need for emergencies into an ISA rather than aregualr savings. then each year open a new one for the new profits.

Keep back enough cash for void periods, repairs/maintence and taxes.

Thank you :-) how much can you pay into these each year?:T

atush

5340 this year, more next.

Cherryjack

atush wrote: »

5340 this year, more next.

Thats brilliant! sounds like a plan

*Chattie*

Cherryjack wrote: »

Thank you thats great :-) i will set one up when the time is ready.. at the moment the money is just building up in a second current account
No company..

As you have £19k debts paying only £1 a month why on earth aren't you paying them off rather than saving this money in a current account?