Leading tax expert provides his top tax-saving tips for struggling landlords

Leading tax expert provides his top tax-saving tips for struggling landlords

Following the Autumn Statement earlier this month, landlords’ profits are due to be slashed after the tax-exempt allowance on capital gains was reduced. This means that the threshold will be cut from £12,300 to £6,000 in April next year, then to £3000 from April 2024. As a result, the average second-property owner could pay £2,600 more in tax, and research from property technology company, iPlace Global, now reveals that over a quarter (26%) of landlords are looking to sell their buy-to-let property due to inability to keep up with rising costs.

Tommy Mcnally, leading tax expert and CEO of tax-refund firm, Tommys Tax, explains that amidst the current economic landscape, and with prices soaring across the board, tax returns have become a critical lifeline for many. In light of the dire economic landscape, alongside an increasing concern of the exodus of buy-to-let landlords, Mcnally has compiled a list of eight tax-saving tips for landlords struggling with soaring prices.

Opt for short-term occupants:
Opting for short-term occupants is a way of claiming council tax and utilities as a regular expense – for this reason, you can save more on running costs.

Declare losses on rental income:
If you spend more on your properties than your take in rental income, this means you have made a rental loss. In the UK, the rental losses can be carried forward and offset against profit in other tax years.

Exclude deposits from your property income tax return:
Make sure you exclude deposits from your new tenants from your property income tax return, as you don’t need to pay tax on them.

Claim the Replacement Domestic Items Relief (RDIR):
The Replacement Domestic Items Relief (RDIR) is a tax relief that landlords can use to claim costs related to the replacement of furniture, household appliance or any item used only by your tenant. The item must be a replacement for the original one – you can’t claim the replacement of domestic items if you are already claiming the Rent a Room relief, or if the property is a furnished holiday letting.

Save some of the income to pay taxes:
If you save a quarter of your rental income in a savings account each month, you will have the needed funds to pay your taxes – all you have to do is set it aside.

Form a limited company:
Setting up a limited company is a smart way of reducing your tax bill as a landlord, especially given that all of your purchases will be made on behalf of the company. This way, you can offset expenses against the profits. However, it’s key to note that you should seek professional advice from your accountant first to check if this strategy is right for you.

Have separate bank accounts:
You might be asked to provide proof of your rental income to the tax inspector – to make it easier to find the right documents, try using a separate bank account. Having a separate rental account from your personal one could make things a lot easier.

Claim your property expenses:
When you file a tax return, make sure that you claim your expenses. You can claim a tax return back on the following:
Advertising costs you may have with your property
Costs from travelling from and to the rental property
Text messages and telephone calls sent in connection with the property
Accountancy fees for rental purposes
Legal fees
Fees for any safety certifications which you obtained for the property
Landlord insurance
Winter rates, council tax, gas and electricity
You must ensure that you have your invoices ready, as you may be required to present this to HMRC.

Tommy Mcnally, leading tax expert and CEO of Tommys Tax comments:

“Taxpayers must ensure that they are aware of the new tax regulations so that they are aware of the correct amounts they should be paying. With HMRC under relentless pressure due to the Autumn Statement, an increased number of audits alongside September’s disastrous mini-Budget, people looking to file their tax return should start the process now to reduce any chance of penalties when submitting.

“In general, people across the UK will be looking at tax refunds as a means to cope with the cost-of-living crisis, and for a majority, this could inject a much-needed boost into their bank accounts. However, our research shows that across the board there is still an obvious lack of knowledge when it comes to the process – which is worrying given that the average tax refund for a PAYE worker, for example, stands at a staggering £1,518.

“With so many unregistered agents out there, as well as the current delays we’re currently experiencing with HMRC, I’m sure that many people are wondering whether they’ll be able to claim their rebates back in time – that is why we’re here to help with the entire process for workers across the country. One of the ways we help is by educating customers about the various tax rebates that people are eligible for, but don’t make use of and that is where we’re here to help. Taxes can be boring, confusing and anxiety-inducing, but if done right could make a real difference to people’s lives.”

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Typically thought of as being an easy to clean area of the home, hard floors have risen in popularity in recent decades. Globally, hard floors are the most common floor type,2 and research released today by Dyson has uncovered poor cleaning habits that mean hard floors are likely to be harbouring an array of hidden nasties. This comes as 32% of Brits – equating to 21.6 million people in the UK – will use the same dirty mop head for six months or more before replacing it. What’s more, one in 20 also admit to keeping the same mop for a year or longer, and one in 10 think it is acceptable to use the same mop 100 times, spreading dirt around their floors every time they use it. Cross contamination is a primary issue for most common and traditional mopping methods with germs and bacteria further being unknowingly spread around homes as Brits use dirty water to clean floors.3 45% only change the water to new water between rooms, whereas 41% wait even longer until it looks dirty. This could mean that floors are being washed with dirty water, adding more dirt rather than taking it away. Surprisingly, almost one in 10 (9%) even admit to not changing the dirty water at all when mopping. Over a quarter (28%) admit to mopping their floors once a fortnight or less while over half (53%) admit they don’t regularly clean behind appliances and leave dirt to build up for as long as six months at a time. image002.jpg On how to achieve a perfect barefoot clean feel after mopping, Geli Lee, Dyson Engineer and Home Cleaning Expert offers their top tips for eliminating dirt around the home: 1. Create a cleaning schedule to stay on top of dirt build-up. In the last year, there has been a 15% global reduction in the number of people who maintain regular cleaning schedules. 47% of the British public admitted to only being motivated to clean when they spot visible dirt or dust.4 Regular floor cleaning with a wet hard floor cleaner like the Dyson WashG1™ removes more stubborn dirt than vacuuming alone. It is important to have a debris free surface, clear any clutter from the floor or other surfaces. Choose the right machine: Different vacuums are designed for different floor types and home sizes. Some machines will be engineered with hard floors in mind and will struggle on thick pile carpets, for example. Choosing the right machine for your home will make a big difference to the ease and speed with which you’re able to clean your home. Clean your floors ‘little and often’. Washing your floors frequently in areas that receive more foot fall will help to stop dirt building up and getting trodden into your floor. Using a dedicated wet floor cleaner on hard flooring such as the Dyson WashG1 is helpful for this, as the versatile format means it vacuums and washes the floor simultaneously. Cleaning schedules have also become less regimented. In recent years only 41% of people claim to have a regular cleaning schedule, and 60% admit to cleaning reactively; being motivated to clean only when there is visible dirt or dust5. It’s perhaps not surprising, that a fifth of people are still concerned their floors are dirty after they’ve mopped them (22%) and one in four6 feel extremely worried about indoor dust at home. Geli Lee, Dyson Engineer and Home Cleaning Expert reveals why it is important to change the way we mop: “Cleaning your hard floors properly and regularly is important for maintaining a healthy environment around your home. Without a proper cleaning routine, dirt may unknowingly build up and spread around your home. It is evident from our research that current mopping habits mean British households aren’t cleaning their floors as effectively as they should. “From ignoring problem areas where dust and debris build up, cross contamination with dirty water to not replacing mop heads or inconsistent cleaning, current mopping behaviours may be making floors dirtier as opposed to cleaner. Moving away from traditional methods, wet floor cleaners like the Dyson WashG1 simplify the floor cleaning experience and provide a modern efficient and hygienic solution” To help take the guesswork out of mopping, the brand new WashG1 is Dyson’s first dedicated wet floor cleaner that tackles wet and dry debris in one go. Engineered for hygienic cleaning and maintenance, the WashG1 is revolutionising wet floor cleaning, removing the need for multi-products and multi-steps to achieve a barefoot clean feel around the home. To put the product to the test, Dyson have cleaned one of London’s most iconic landmarks The Victoria and Albert Museum. From cleaning the grand marble floors housing the most prestigious exhibits, to cleaning up leftover food in the Gamble Room Cafe, the WashG1 had a dirt busting tour of the museum leaving it spotless. Images can be found here. The WashG1 introduces Dyson’s engineering expertise to cleaning hard floors. With a 1 litre clean-water tank to cover flooring up to 290m2, the Dyson WashG1 uses a combination of hydration, absorption, and extraction technologies to remove wet and dry spills and stains simultaneously. The Dyson WashG1 is available to purchase now from Dyson.co.uk, retailing at £599.99.

Typically thought of as being an easy to clean area of the home, hard floors have risen in popularity in recent decades. Globally, hard floors are the most common floor type,2 and research released today by Dyson has uncovered poor cleaning habits that mean hard floors are likely to be harbouring an array of hidden nasties. This comes as 32% of Brits – equating to 21.6 million people in the UK – will use the same dirty mop head for six months or more before replacing it. What’s more, one in 20 also admit to keeping the same mop for a year or longer, and one in 10 think it is acceptable to use the same mop 100 times, spreading dirt around their floors every time they use it. Cross contamination is a primary issue for most common and traditional mopping methods with germs and bacteria further being unknowingly spread around homes as Brits use dirty water to clean floors.3 45% only change the water to new water between rooms, whereas 41% wait even longer until it looks dirty. This could mean that floors are being washed with dirty water, adding more dirt rather than taking it away. Surprisingly, almost one in 10 (9%) even admit to not changing the dirty water at all when mopping. Over a quarter (28%) admit to mopping their floors once a fortnight or less while over half (53%) admit they don’t regularly clean behind appliances and leave dirt to build up for as long as six months at a time. image002.jpg On how to achieve a perfect barefoot clean feel after mopping, Geli Lee, Dyson Engineer and Home Cleaning Expert offers their top tips for eliminating dirt around the home: 1. Create a cleaning schedule to stay on top of dirt build-up. In the last year, there has been a 15% global reduction in the number of people who maintain regular cleaning schedules. 47% of the British public admitted to only being motivated to clean when they spot visible dirt or dust.4 Regular floor cleaning with a wet hard floor cleaner like the Dyson WashG1™ removes more stubborn dirt than vacuuming alone. It is important to have a debris free surface, clear any clutter from the floor or other surfaces. Choose the right machine: Different vacuums are designed for different floor types and home sizes. Some machines will be engineered with hard floors in mind and will struggle on thick pile carpets, for example. Choosing the right machine for your home will make a big difference to the ease and speed with which you’re able to clean your home. Clean your floors ‘little and often’. Washing your floors frequently in areas that receive more foot fall will help to stop dirt building up and getting trodden into your floor. Using a dedicated wet floor cleaner on hard flooring such as the Dyson WashG1 is helpful for this, as the versatile format means it vacuums and washes the floor simultaneously. Cleaning schedules have also become less regimented. In recent years only 41% of people claim to have a regular cleaning schedule, and 60% admit to cleaning reactively; being motivated to clean only when there is visible dirt or dust5. It’s perhaps not surprising, that a fifth of people are still concerned their floors are dirty after they’ve mopped them (22%) and one in four6 feel extremely worried about indoor dust at home. Geli Lee, Dyson Engineer and Home Cleaning Expert reveals why it is important to change the way we mop: “Cleaning your hard floors properly and regularly is important for maintaining a healthy environment around your home. Without a proper cleaning routine, dirt may unknowingly build up and spread around your home. It is evident from our research that current mopping habits mean British households aren’t cleaning their floors as effectively as they should. “From ignoring problem areas where dust and debris build up, cross contamination with dirty water to not replacing mop heads or inconsistent cleaning, current mopping behaviours may be making floors dirtier as opposed to cleaner. Moving away from traditional methods, wet floor cleaners like the Dyson WashG1 simplify the floor cleaning experience and provide a modern efficient and hygienic solution” To help take the guesswork out of mopping, the brand new WashG1 is Dyson’s first dedicated wet floor cleaner that tackles wet and dry debris in one go. Engineered for hygienic cleaning and maintenance, the WashG1 is revolutionising wet floor cleaning, removing the need for multi-products and multi-steps to achieve a barefoot clean feel around the home. To put the product to the test, Dyson have cleaned one of London’s most iconic landmarks The Victoria and Albert Museum. From cleaning the grand marble floors housing the most prestigious exhibits, to cleaning up leftover food in the Gamble Room Cafe, the WashG1 had a dirt busting tour of the museum leaving it spotless. Images can be found here. The WashG1 introduces Dyson’s engineering expertise to cleaning hard floors. With a 1 litre clean-water tank to cover flooring up to 290m2, the Dyson WashG1 uses a combination of hydration, absorption, and extraction technologies to remove wet and dry spills and stains simultaneously. The Dyson WashG1 is available to purchase now from Dyson.co.uk, retailing at £599.99.

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