Tax Insider is a new venture from TaxationWeb, the UK's leading independent tax portal.
Each month our tax experts reveal tax strategies to help minimise your property taxes.
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Here is what our tax experts are sharing with you in this month's magazine:
- New for Old! The End of the Renewals Allowance
The tax legislation provides for a deduction for the cost of renewing “trade tools” (see ITTOIA 2005, s 68). The legislation is considered to refer only to small items such as hammers, chisels and so on, but by concession the relief has been extended to any items of plant and machinery.The allowance works on the basis that you cannot have a deduction for... - Claiming Travel Costs in Property Rental Businesses
A rented property portfolio may not be placed in the same street or even the same town as your main residence or place of work. Travel from one property to another, as the landlord dealing with problems as they arise, does cost. That cost is allowed as an expense against rental income received.The treatment of travel expenses is similar to that as incurred... - What is a `dwelling house’ and Why Does it Matter?
At first sight, it would seem that the answer to the question `What is a dwelling house?’ is pretty straightforward. Most people would have a clear idea of what they regard as a house and as a dwelling. The Oxford English dictionary defines a `dwelling house’ as a house used as a residence, not as an office etc. `Residence’ is defined as... - Use it or Lose it! Flat Conversion Allowance
There is a special relief that allows significant tax write-offs for the cost of getting disused flats over commercial premises back into letting condition. This article will cover the basics of what could, for many property owners, prove to be a potentially valuable tax break. But be warned... - Tax Insider: Tax Tips
- Tax Insider: Your Property Tax Questions Answered by Arthur Weller
I wholeheartedly recommend the ‘Tax Insider’ to anyone who is interested in legitimately minimising their tax bill.
Dr Bennie Mallett, General Practitioner
Its sole purpose is to help you to legitimately avoid or minimise your property income tax, capital gains tax, inheritance tax etc.
This monthly magazine will particularly benefit the following:
- Landlords with properties in the UK
- Property investors who hold property overseas
- UK and international property developers
- Accountants or tax advisors who have property clients
- Financial advisors
- Three Homes Are Where the Heart Is! More Insights Into What Makes A ’Main Residence’(February 2012)
- Renewable Energy and Tax (Part 2) – Business Tax(January 2012)
- Solar Power for Property Owners (Part 1)(December 2011)
- Tenant Deposits: Traps & Tips(November 2011)
- Limited Companies for Landlords(November 2011)
- Claiming Tax Relief for Capital Expenditure - Part 3(November 2011)
- How to Use Trusts to Protect Property Assets(November 2011)
- Escape the Capital Gains Tax Trap!(November 2011)
- When Investments Go Bad! Claiming Tax Relief(October 2011)
- Using Trusts to Minimise Property Capital Gains Tax (CGT)(October 2011)
- Can I Receive Gross Rental Income from Property Agent?(September 2011)
- Can My Brother ‘Gift’ Me a Share of a Property in His Name?(September 2011)
- Can Our Property Business Hire My Self-Employed Partner?(August 2010)
- Can I Claim Mortgage Relief for the Period of Trying to Sell My Property?(July 2010)
- Can my brother sell me our joint property below market value?(December 2009)
- Does the day of arrival count towards the 70 day rule?(December 2009)
- Is it Possible to Transfer Our Property Into My Sole Name on The Basis That I Pay Him £10,000 Settlement?(November 2009)
- Can my son live rent-free in the property?(November 2009)
Can I Claim Mortgage Relief for the Period of Trying to Sell My Property?
I unsuccessfully tried to sell a rental property over a period of 9 months (various buyers dropped out for various reasons!). The property was untenanted (i.e. vacant possession for sale) after the first 2 months of the 9 month period but is now rented again.
Can I claim mortgage interest relief for the period in which I was trying to sell the property but had not instructed the letting agent to market the property.
Arthur Weller Replies:
On page PIM2105 of the Revenue Property Income Manual the Revenue say:
"A property may be let for short periods in a tax year or only part of it may be let throughout a tax year (or both); the rest of the time the property is used for private or non-business purposes. Here the interest charged on a qualifying loan on that property has to be split between the rental business use and the private or non-business use. The split is done in whatever way produces a fair and reasonable business deduction, taking account of both the proportion of business use and the length of business use.
You don’t have to split the interest if the taxpayer is genuinely trying to let the property but it is empty because they have not been able to find a tenant. In this case the interest will meet the ‘wholly and exclusively’ test. It won’t meet this test if they have not been trying to let the property or they have been using it for private or non-business purposes.”
It would appear from this that if in a period you were not trying to let the property then for that period of time you cannot claim mortgage interest relief.
- Private Residence Relief and Working From Home(June 2010)
- Stamp Duty Land Tax Tip(May 2010)
- Reclaiming Your Class Four NIC(April 2010)
- Tax Return Help Sheet for Negligible Value Claims(March 2010)
- How to Qualify for Furnished Holiday Accommodation Relief(January 2010)
- HMRC(December 2009)
- Review Your Position In 2014(December 2009)
- You Can Create a Tax Loss By Knocking a Building Down(November 2009)
- Renovations and alterations(October 2008)
- Do you have two properties that could be your main residence?(May 2008)
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