Tax saving tips for landlordsMake Text Bigger
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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