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  • FIRST POST
    • steveo999
    • By steveo999 9th Jan 18, 10:33 PM
    • 55Posts
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    steveo999
    renting out - costs inc tax help
    • #1
    • 9th Jan 18, 10:33 PM
    renting out - costs inc tax help 9th Jan 18 at 10:33 PM
    Im looking at moving in with my other half (she is moving to a new property)


    I own mine yet still have a mortgage and am looking to rent out to save money


    Im still unclear of the costs and looks like I will actually lose money when tax is bought into the equasion


    So question for landlords:


    1. Do I need an accountant for the tax payable or can I do this myself via a SATR?


    2 Is there a calculator or similar online so I can predict my costs?
Page 1
    • capital0ne
    • By capital0ne 9th Jan 18, 11:41 PM
    • 524 Posts
    • 254 Thanks
    capital0ne
    • #2
    • 9th Jan 18, 11:41 PM
    • #2
    • 9th Jan 18, 11:41 PM
    You can do it yourself on your SATR - it's straightforward, and I recall if your rental income is less than 15k you don't need to itemise things.

    You need to tell HMRC the Income and costs involved, for example any work on the property while rented comes off the income as do other expenses like insurance, agent fees etc, anything you pay towards the property or the rental can be deducted - you may make a profit after all!
    • steveo999
    • By steveo999 10th Jan 18, 9:54 PM
    • 55 Posts
    • 0 Thanks
    steveo999
    • #3
    • 10th Jan 18, 9:54 PM
    • #3
    • 10th Jan 18, 9:54 PM
    Is there any calculator I can use so I have an idea?
    • DCFC79
    • By DCFC79 10th Jan 18, 10:13 PM
    • 31,938 Posts
    • 20,120 Thanks
    DCFC79
    • #4
    • 10th Jan 18, 10:13 PM
    • #4
    • 10th Jan 18, 10:13 PM
    I take it you have looked into if your mortgage provider will let you rent it out ?
    • G_M
    • By G_M 10th Jan 18, 10:20 PM
    • 44,484 Posts
    • 52,825 Thanks
    G_M
    • #5
    • 10th Jan 18, 10:20 PM
    • #5
    • 10th Jan 18, 10:20 PM
    ... and freeholder if you have a lease.

    * New landlords: advice, information & links

    * Letting agents: how should a landlord select or sack?
    • Corona
    • By Corona 11th Jan 18, 12:03 PM
    • 848 Posts
    • 793 Thanks
    Corona
    • #6
    • 11th Jan 18, 12:03 PM
    • #6
    • 11th Jan 18, 12:03 PM
    There's some very good information on the HMRC website about income, costs, etc. for landlords, e.g. https://www.gov.uk/renting-out-a-property/paying-tax / what you can claim, etc. They also run regular webinars for landlords, to answer individual questions.

    You can only claim costs AFTER the property is rented for the first time (unless it's unfit for habitation), so getting it ready to be rented out - e.g. legal requirements such as gas & electric safety checks, smoke alarms, plus other things like decorating, can't be claimed for when you're setting up the property to be rented. Once it's been rented, then annual gas checks (legally required), repairs, like for like replacements (e.g. replacing a broken cooker), buildings & contents insurance, letting agency costs, etc. can be claimed against rental income.

    Remember that you'll have to take over utility costs, and council tax, during times when you don't have a tenant (but I don't think you can claim for those - someone-else may know differently??)

    You should be able to do this via a SATR - there's a separate form (SA105) which is just for income from property, to attach to the main form (SA100).

    Do your figures carefully - you could still come out in profit (especially if the property increases in value).
    • Comms69
    • By Comms69 11th Jan 18, 12:10 PM
    • 2,970 Posts
    • 2,939 Thanks
    Comms69
    • #7
    • 11th Jan 18, 12:10 PM
    • #7
    • 11th Jan 18, 12:10 PM
    Im looking at moving in with my other half (she is moving to a new property)


    I own mine yet still have a mortgage and am looking to rent out to save money


    Im still unclear of the costs and looks like I will actually lose money when tax is bought into the equasion


    So question for landlords:


    1. Do I need an accountant for the tax payable or can I do this myself via a SATR?


    2 Is there a calculator or similar online so I can predict my costs?
    Originally posted by steveo999


    You might be able to do it yourself (my sister managed to do a self assessment, so anyone can really!)


    I don't know what you mean by costs.


    Have you got consent to let? If not, the whole things stops


    Have you considered what you do if the tenant stops paying rent?
    Will you have a letting agent?
    Have you looked at your obligations (failing these can lead to financial penalties - or even criminal in extreme circumstances)
    You say you will actually lose money? That seems unlikely. Remember you are paying off equity and building value too.
    • 00ec25
    • By 00ec25 11th Jan 18, 7:04 PM
    • 6,517 Posts
    • 6,078 Thanks
    00ec25
    • #8
    • 11th Jan 18, 7:04 PM
    • #8
    • 11th Jan 18, 7:04 PM
    1. Do I need an accountant for the tax payable or can I do this myself via a SATR?

    2 Is there a calculator or similar online so I can predict my costs?
    Originally posted by steveo999
    the tax return is your calculator, do it online and it will tell you your tax liability every time you save it. Just don't submit it until you are ready to do so (even then you can still amend it later if needs be)

    whether you need an accountant or not depends on how much work you are prepared to do in educating yourself.

    HMRC course: http://www.hmrc.gov.uk/courses/syob3/new_letting/HTML/new_letting_menu.html
    simpleton's guide: https://www.gov.uk/renting-out-a-property/paying-tax
    proper guide: https://www.gov.uk/hmrc-internal-manuals/property-income-manual

    You can only claim costs AFTER the property is rented for the first time (unless it's unfit for habitation), so getting it ready to be rented out - e.g. legal requirements such as gas & electric safety checks, smoke alarms, plus other things like decorating, can't be claimed for when you're setting up the property to be rented. yes you can - subject to some rules Once it's been rented, then annual gas checks (legally required), repairs, like for like replacements (e.g. replacing a broken cooker), buildings & contents insurance, letting agency costs, etc. can be claimed against rental income. correct, the renewals rules now apply

    Remember that you'll have to take over utility costs, and council tax, during times when you don't have a tenant (but I don't think you can claim for those - someone-else may know differently??) yes you can, provided the void period is a genuine void, not personal use

    You should be able to do this via a SATR - there's a separate form (SA105) which is just for income from property, to attach to the main form (SA100).

    Do your figures carefully - you could still come out in profit (especially if the property increases in value).
    Originally posted by Corona
    read: https://www.gov.uk/hmrc-internal-manuals/property-income-manual/pim2505
    Last edited by 00ec25; 11-01-2018 at 10:40 PM.
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