19/08/2024
Landlords, Are you sure you are deducting all of your allowable expenses?
As a landlord, it’s crucial to know which expenses you can deduct from your rental income to optimize your tax savings. But I often find clients missing out on savings due to not including everything.
Maintenance and Repairs: Costs for general maintenance and repairs are deductible, but improvements that increase the property’s value are not (these can be used against your CGT bill when you sell the property).
So a new boiler is deductible but a new driveway is not!
Finance Costs: Only the interest portion of your mortgage payments is deductible. This is restricted to 20% of the finance costs.
So keep your annual mortgage statement to make your accountants life easier! (please 😂)
Utilities and Services: Expenses for utilities like water, gas, and electricity, as well as services such as cleaning and gardening, can be deducted.
Insurance: Premiums for landlord insurance policies, including building and contents insurance, are allowable.
Professional Fees: Fees paid to letting agents, accountants (my fees 😀), and legal advisors can be deducted.
Other Costs: This includes advertising for tenants, ground rent, and service charges.
I’ve found that understanding these allowable expenses will make a significant difference in how you manage your rental properties efficiently. It’s not just about saving money—it’s about making informed decisions that benefit both you and your tenants.
If you've got this far you may be wondering what the picture has to do with the post? Well, nothing I just thought it was a nice pic 🤷♂️
