How to manage money as a landlord

ooberandy

I'm just about to buy a property with the intention of letting it out.

I'm wondering what's the best way to manage the money on the property. Am I best opening a current account, or would an instant access savings account best? Any other advice would be helpful too.

Many thanks

booksurr

strange question

for tax purposes it is more transparent for your tax return if you have a separate account that all income and expenditure related to the rental business goes in and out of but other than that it down to what you intend to do with the profit you make - you will need an account out of which you can make payments and then you also need a home for the profit

using your personal current account for payments is of course possible and having the tenants pay his rent into a savings account which you then raid to fund the current account is also possible

if it were me I would choose based on the fact I intend to keep the profits long term so would use a current account to receive rent and make payments and then syphon off the profit to somewhere better than an instant access savings account

ooberandy

Thanks for the reply. It was just a naive question, I'm new to this and want to get it set up properly.

I'll have a hunt about for the best current account

Halle71

We have our BTL rent paid into and our BTL mortgage paid out of, our joint account but as soon as the rent is paid in we transfer the balance to a separate account.

We keep a record of expenditure and monthly outgoings for tax purposes on the BTL, but pretty much pay these items from the joint account so we have money for emergencies/tax in the BTL account should we need it.

ognum

ooberandy wrote: »

I'm just about to buy a property with the intention of letting it out.

I'm wondering what's the best way to manage the money on the property. Am I best opening a current account, or would an instant access savings account best? Any other advice would be helpful too.

Many thanks

I have a separate account and all income and expenditure from my rental properties goes though this. the account is transparent and auditable. I find it is easier for me to complete my tax return this way,

I do keep enough money in the account to pay HMRC and a slush fund that would cover all eventualities like a replacement boiler or other maintenance, I attempt to never keep a tenant waiting for repairs etc.

I do not pay myself a regular income but do periodically remove money to savings and investments. The system works for me.

Conrad

I use the Santander 123 account - decent interest on any balances up to £20k.
This is solely for buy to let. I also keep books (basic ins and outs) and a copy of all receipts.


Over time we syphon off into stocks n shares ISA's.