Tax saving tips for landlords

Tax saving tips for landlords

17:07 PM, 14th March 2012, About 12 years ago 6

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It’s not often the tax man gives something away, but from the start of the next tax year landlords can pick up a little extra.

For many landlords, big tax savings do not often come from major strategies, but from adding together several small reliefs and allowances.

Two to watch are home as office costs and business mileage.

From April 6th, all landlords can claim £208 for running a home office for their business without any comment from a tax inspector.

HM Revenue and Customs have upped the allowance from £150 a year to £208 – costed as £4 a week.

Little known detail in HMRC’s own guidance manual for tax inspectors offers the loophole.

BIM 47805 says tax inspectors can accept the expense without detailed inquiry. That’s HMRC speak for letting the expense through a tax return no questions asked.

All a landlord has to do to claim the expense is to add £208 to the other expenses section of the property pages on the tax return. Landlords, holiday let owners and investors letting property overseas can all make the claim.

The term ‘reasonable estimate’ is based on the amount employees and directors can claim for working from home without incurring national insurance contributions.

HMRC official mileage rates also increase from April 6th – from 40p per mile to 45p per mile for the first 10,000 business miles and 25p per mile for any further travel. Landlords can also claim an extra 5p a mile for any passengers along for the business trip.

Rates for motorcycles and bicycles remain the same flat rates – 24p a mile for motorbikes and 20p for bikes.

The best way to claim is to keep a logbook in the car listing business trips, if a passenger was taken, the mileage involved, and the start and finish points.

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Lynne Davis

10:07 AM, 20th March 2012, About 12 years ago

Thanks for these tips, much appreciated!

19:32 PM, 20th March 2012, About 12 years ago

Where do I obtain a full version of HMRC's rules on allowances for btl landlords?

19:43 PM, 20th March 2012, About 12 years ago

I am very surprised at your suggested figure of £208 per year for use of home as office.   When I started in 1995/6 my accountant, who was a former tax inspector suggested , and did use in my accounts, a figure of £350 pa.   With inflation surely that should be now £6-700 ?

Mark Alexander - Founder of Property118

20:16 PM, 20th March 2012, About 12 years ago

Very good question, I don't think HMRC produce one. My suggetion would be to Google "Steve Sims Property Tax" and take a look at his book which you can buy on Amazon.

Mark Alexander - Founder of Property118

20:19 PM, 20th March 2012, About 12 years ago

You can claim whatever you like so long as you can justify it if you have a tax investigation. £208 is the maximum you can claim with no questions asked.


15:08 PM, 2nd July 2016, About 8 years ago

Just wondering if anyone has got the 2015/16 figures for using your own home and mileage allowance?


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