Landlords are becoming concerned about rising tax returns, according to a new report. Findings from The Landlord Syndicate suggest that low interest rates and increased rental income are leading to landlords having to deal with higher tax returns than predicted.
The Landlord Syndicate
The Landlord Syndicate is made up of a network of companies that offer complete support for landlords. Reports from the Tax Insider, which is a member of the Landlord Syndicate, indicate that 52% of landlords would encourage greater tax saving guidance.
Substantial Growth
Amer Siddiq, Managing Director of Tax Insider, said that landlords could be fooled into thinking that they can make more profit than actually materialises. Siddiq said, ‘the buy-to-let market has grown substantially and with it, many landlords have been able to profit from the ever-increasing rental income and record low interest rates.[1]’
‘However, in a large percentage of cases, how much tax a landlord has to pay as a result of the size of their portfolio and having fewer outgoings to offset against tax, will be crucial to how profitable their investment really is.[1]’
Organisation
The findings of the report by The Landlord Syndicate stated that four in ten landlords think that reducing tax liability is the largest obstacle facing landlords in 2012. Siddiq suggests that simple organisation from landlords could go a long way in achieving this. He claims that lost receipts, poor statistic keeping, wrongly claiming expenses and even paying unnecessary tax bills have all led landlords to fall foul of tax liability.
Siddiq concluded that it is, ‘vital that landlords are knowledgeable about what offsetting opportunities are available to them. For example, most landlords are aware they can offset tax against their mortgage interest, rates and repairs. However, many fail to claim other costs such as travel to and from the property, advertising costs and phone calls, all of which may seem insignificant, but can certainly add up over the year.[1]”
[1] http://www.justlandlords.co.uk/news/Tax-Concerns-for-Landlords-1078.html