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If I buy a property to let, is tax payable on ALL the rent I receive , or just the part the is left over from paying the mortgage ? Thanks for any help.
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Buy To Let
- Thread starter User removed 4
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owlsonlineadmin
New member
- Jul 22, 2010
- 133
You only pay tax on the profits, so rent - expenses (repairs, wear and tear, insurance, mortgage interest, agency fees etc).
Your taxable income would be based on your total rental income less the "interest" payments (not capital) and any other expenses such as repairs/insurance/maintenance etc....Speak to Uncle Spielberg for the best mortgage deals out there if you need one!
SockMonster
Well-known member
Tax is payable on the net rental figure after taking into account expenses including mortgage and any maintenance work agent expenses etc.
Think that is correct.
Think that is correct.
User removed 4
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- Thread starter
- #5
Already done so, couldnt better my mortgage deal, but got me extremely good deal on my life/critical illness cover for the mortgage, definitely reccomend him.
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Cheers lads.
Tricky Dicky
New member
Offset any expense incurred.
kjgood
Well-known member
The Auditor
New member
yep but must be a tax deductable one ... dont forget travelling to check the property is ok
Hampster Gull
Well-known member
- Dec 22, 2010
- 13,465
Interest on the mortgage is deductable from the rental cost, but only for the amount you borrow when you buy. So if you re mortgage to raise funds the additional rental payments arent deductable.
Also the profit on sale is subject to capital gains tax. You can write to HMRC and say its your main home for a short period, eg a week or two, and then you will get the last three years of ownership capital gains tax free. But it should be your main home, not like the MPs who abused this.
Also the profit on sale is subject to capital gains tax. You can write to HMRC and say its your main home for a short period, eg a week or two, and then you will get the last three years of ownership capital gains tax free. But it should be your main home, not like the MPs who abused this.
cloud
Well-known member
You can also pay less capital gains tax by claiming Entrepreners Relief. This effectively means that instead of paying 18% CGT you pay 10% Entrepeneurs Relief.
When you buy a new property you get a 2 year period to declare your primary residence, something to consider if you have a choice of properties.
Shoreham Gull
New member
Tax is only payable on profit, after mortage paid! So rent £900 , mortage £550 , £900-£550 = £350 to be taxed..
Keep all receipts for work done on property against tax!
Also the biggest problem with being a landlord is finding a great letting agency, I've been robbed and lied to by them and has cost me and my partner thousands, had to stop her smashing ones windows in.
Had D.S.S put it my property, when I said no d.s.s., they didn't pay the rent even tho on housing benefit and refused to leave, and to top it of when they lefted they took= curtain rails, sky dish, shelves, damaged walls, destroyed garden, lefted toys rubbish etc needed a skip and even took LIGHT BULBS.. My partner was pregnant a stressed, Letting agent didn't even care and they even tried to take a cut out of deposit for themselfs, Bastards!
As u can see a very sore point, I'd like to say the name of letting agent so everyone avoids it,but better not
cloud
Well-known member
Not quite right - you don't deduct the whole mortgage payment, only the interest.
Major building works are not deducted as an expense, but come off the capital gains tax bill at the end.
brightonbaz
Active member
- Feb 22, 2009
- 181
On the same subject i.e. buy to let mortgages can equity in a current property be used/as for a deposit on a buy to let mortgage?
Vegas Seagull
New member
- Jul 10, 2009
- 7,782
If you are left with a positive net rental figure can you choose to 'overpay ' the mortgage by that amount leaving zero tax payable?
cloud
Well-known member
No, because you only deduct the interest payments, not the whole mortgage. If you over-pay, the interest payable across the year will be less, so you'll end up paying more tax!
If you get an equity release mortgage on your current property, you can do what you like with it (stick it on red!). But you obviously can't just say 'my house is worth more than my mortgage, can I have something for nothing please'.