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Property Tax Insider

Try Property Tax Insider today and receive:

  • 3 FREE Issues - The current October #110 and the previous two issues of September #109 and August #108 (12 tax saving articles)
  • Delivered to your doorstep
    Here are the 12 strategies our tax experts are sharing with you as part of your free trial:
    • Private residence relief: Planning for future changes
    • In recent years, landlords and those with second homes have been on the receiving end of a raft of tax changes, which has hit them in the pocket. Unfortunately, there are more changes on the horizon, which will restrict lettings relief and halve the final period exemption.

      Sarah Bradford explores the draft Finance Bill changes to private residence relief for capital gains tax purposes.
    • How much is deductible for motor expenses in managing my property business?
    • Historically, there was only one method of deducting motor expenses incurred from a rental property business, which was by firstly claiming capital allowances on the cost of the vehicle, and then deducting the actual running costs annually. From the tax year 2017/18, unincorporated landlords using the cash or the accruals basis have been able to decide instead to use a fixed rate mileage deduction.

      Meg Saksida explains how motor expenses in managing your property can be offset against your rental income.
    • Co-habiting vs marriage/civil partnership
    • Much tax planning orients around distributing assets and (where possible) income between a couple. This is usually considered in reference to a married couple or civil partnership. This article considers some of the key differences between those who are legally ‘a couple’ and those who are merely co-habiting.

      Lee Sharpe has some tax-efficient tips for helping children move into a property.
    • NICs on rental profits?
    • Individual owners of buy-to-let rental properties generally assume there are no National Insurance contributions (NICs) to pay on their rental profits (as there are for self-employed individuals carrying on a trade).

      Mark McLaughlin looks at whether individual landlords of buy-to-let properties are liable to pay National Insurance contributions on their rental profits.
    • Property expenses: Don’t ask HMRC?  
    • Taxpayers such as buy-to-let landlords often seek advice from HM Revenue and Customs (HMRC).

      Mark McLaughlin highlights a case where the taxpayer was accused of making a careless error despite seeking HMRC’s advice.
    • Tax on property gains: Some planning ideas 
    • It’s a longstanding, and in my view justified, complaint on the part of property investors that they are taxed on inflation.  In fact, since the abolition of capital gains tax (CGT) indexation allowance a few years back, the whole of CGT has been a tax on inflation, as well as a tax on ‘real’ gains; it’s just that this has a much more marked an effect where you’re talking about property, which historically has had a rate of inflation far in excess of anything that you will find in the retail prices index.

      Alan Pink picks out some lesser-known possibilities for reducing capital gains tax on property. 
    • Using HMRC’s property rental toolkit to avoid common errors 
    • Mistakes in completing self-assessment returns can prove costly. There is the risk that more tax will be paid than is necessary. If tax is understated and HMRC judges that reasonable care has not been taken, there is also the possibility of penalties. However, in seeking to avoid common errors there is help at hand in the form of HMRC’s toolkits.

      Sarah Bradford explores how HMRC’s property rental toolkit can be used to avoid common errors when completing the property income pages of the self-assessment return. 
    • Helping children onto the property ladder
    • We shall be looking at improving children’s access to capital from the perspective of parents or grandparents who have a property portfolio and therefore capital wealth, but are ‘locked’ into bricks and mortar.

      Lee Sharpe has some tax-efficient tips for helping children move into a property.
    • 'Pros' and 'cons' of incorporating a property letting business 
    • There are a number of reasons for running a property letting business through a limited company. Perhaps the single biggest motivator for running a BTL business through a company is the escalating restriction of tax relief for mortgages and other finance costs for residential property profits subject to income tax. However, there are many more important considerations to be made.

      Lee Sharpe looks at the 'pros' and ‘cons’ of incorporating a property letting business.
    • HMRC being unfair? What next?! 
    • Taxpayers sometimes have grievances about HM Revenue and Customs (HMRC), such as mistakes or unreasonable delays.  What can be done?

      Mark McLaughlin looks at how HMRC’s actions can be challenged if they are considered unfair.
    • A tax that’s (H)ATED! 
    • The annual tax on enveloped dwellings (ATED) is, as the name suggests, an annual tax on `dwellings’ held within an ‘envelope’, usually a company. Most residential properties are owned by individuals. However, where such a property is held by a company or other collective investment vehicle, the property is said to be ‘enveloped’ – ownership of the property sits within a corporate ‘wrapper’ or ‘envelope’.

      Sarah Bradford explains when the annual tax on enveloped dwellings applies and how to submit returns and pay the tax.
    • Property expenses: The importance of timing 
    • Timing is very important in a number of situations. When it comes to expenditures, the timing of when they are incured can be the difference between a significant tax liablity, a reduced or even zero tax bill.

      Alan Pink looks at three situations where property tax can be reduced by careful consideration of the timing of expenses.

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