Spending Money on Property repairs to offset the impact of ‘section 24’ mortgage interest relief restrictions

By specialist property accountant Stephen Fay ACA

The single biggest tax issue facing many landlords who own mortgaged residential rental property is the introduction of the new (as of tax year 2018) mortgage interest relief restrictions known as ‘Section 24’. This article looks how landlords can spend money on property repairs to help to mitigate the impact of this significant worsening of the tax regime for ‘private landlords’ (meaning, landlords who own their property in their own personal name, or in a partnership).
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Company owners – MASSIVE tax benefit in having an electric company car from April 2020

By specialist property accountant Stephen Fay ACA

Many property investors now operate a limited company, and many have spare funds in the company that could be used to fund a company car – or, who would naturally prefer to run their car via the company if tax-efficient to do so – which, at present it almost always isn’t. From April 2020, there will be a radical change to the electric company car regime that will mean electric company cars will become very tax-efficient – this article looks at why …

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What to do with spare funds held in your property company

By specialist property accountant Stephen Fay ACA

Many property investors now operate a limited company, and may not be able to tax-efficiently take all of the company’s profits out, due to their personal income. This article looks at what options are available to company property investors who want to be tax –efficient by retaining spare funds within their company.

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Using a simple partnership combat the effect of Section 24 mortgage interest restrictions

By specialist property accountant Stephen Fay ACA

Tax year 2018 sees the start of the new ‘Section 24’ residential mortgage interest relief restrictions, which phase in over tax years 2018 (25%), 2019 (50%), 2020 (75%), 2021 (100%), with only a flat-rate 20% tax credit allowed for mortgage interest / fees paid, regardless of the tax rate of the investor. However, using a ‘simple’ partnership can be useful in allocating property profits in the most beneficial way to ensure that each individual’s tax status is fully-utilised.
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How to avoid a HMRC Tax Enquiry

By specialist property accountant Stephen Fay ACA

Most property investors are required to file an annual tax return with HMRC, to account for their personal income and pay tax on that income. As this system is on a ‘self-assessment’ basis, and there are over 8 million personal tax returns filed each year, HMRC simply don’t have the resources to check every tax return that is filed – instead, HMRC look at a sample of tax returns each year – this used to be called an ‘investigation’, whereas more recently HMRC call this an ‘Enquiry’ (intended to sound less confrontational!).

This article looks at what a HMRC Enquiry is exactly, and how the risk of an Enquiry can be legitimately minimised.

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I’m a property developer – can I claim Entrepeneurs Relief

By specialist property accountant Stephen Fay ACA

Many property investors – whether landlords or developers – have heard of ‘Entrepreneurs Relief’ (ER), but aren’t clear about what it is, and could they benefit from this tax relief. This article explains what ER is, when it can be claimed, and when it may not be beneficial to claim ER.
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What is a director’s loan account and why is it useful?

By specialist property accountant Stephen Fay ACA

Following the introduction of the new ‘Section 24’ mortgage interest relief restrictions, many property investors are now using a company to invest in property. Generally, the most tax-efficient way to fund a property investment company is via a Directors Loan Account – but how do these work & why are they useful?
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Residential landlords – are you aware of the tax benefits of renting furniture & appliances?

By specialist property accountant Stephen Fay ACA

Traditionally, residential landlords would claim the ‘Wear and Tear Allowance’ when renting residential property – however this allowance was abolished as of April 2016, and replaced with a ‘furniture replacements’ allowance, which is a significantly less generous tax relief. This article looks at the changes made to this aspect of renting residential property, current position, and how renting furniture and appliances can result in a full tax deduction for the cost.

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Strategic re-mortgaging to mitigate ‘Section 24’ mortgage interest relief restrictions

By specialist property accountant Stephen Fay ACA

‘Section 24’ mortgage interest relief restrictions begin from April 2017, meaning that over the next 4 tax years, mortgage interest will become less and less tax-deductible. Re-mortgaging to reduce mortgage interest relief is an obvious way to reduce the impact of Section 24 – but for many investors, their cash resources are precious and so need to be used wisely – this article explains how strategic re-mortgaging can have a significantly better impact than a more haphazard approach to mortgaging property.
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Converting a property into a HMO? How to save up to 75% of your VAT costs

By specialist property accountant Stephen Fay ACA

A common property investment strategy is to buy a property and convert it into a HMO. This can be an expensive strategy however, not helped by the 20% VAT charged by suppliers and builders. However, in many cases it is possible to pay up to 75% less VAT for certain ‘qualifying’ conversions.
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