Tax expert comments on Paragon Group landlord surveyMake Text Bigger
Many landlords are handing unnecessary cash over to the tax man because they do not know what expenses they can claim for running their property businesses.
Even a new study by landlord mortgage specialist Paragon Mortgages does not cover all the costs that a buy to let investor can claim.
Paragon claims huge numbers of landlords would benefit from a specialist property accountant looking at their business records
Paragon’s research shows around one in 10 landlords (13%) do not reclaim mortgage interest.
Claiming property costs
About a third do not claim management or letting agent fees, with 55% of landlords are ignoring advertising costs incurred in letting property.
Huge numbers of landlords miss out on saving tax because they omit business costs from the tax returns.
Even worse, many are in for a nasty surprise when HM Revenue and Customs checks their records because they are claiming property costs that should not go through the books.
He also explained many landlord husband and wife teams could benefit from reviewing tax effective ownership of their properties because they are paying too much top rate tax that is easily avoidable.
Common rental expenses
Although the Paragon research highlights some of the most common rental business expenses that landlords are not claiming, several more are not covered – like home as office costs and capital allowances for holiday homes and houses in multiple occupation.
Another area of confusion over what to claim as expenses for landlords is refurbishing property before letting and taking on inherited property.
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