Taxation

As a Landlord you will be liable for tax on rental income and you must inform HMRC that you are letting the premises.

There are a number of allowances that you can claim against your rental income. You should seek advice on these allowances from your accountant or from HMRC website which can be accessed on www.hmrc.gov.uk. You must also keep all your invoices for six years for tax purposes.

Taxation for Overseas Landlords

HMRC has special rules regarding the collection of tax on rental income if you are a Landlord who is resident overseas, or you subsequently move abroad. If you fall into this category it is your responsibility to obtain a tax approval number from HMRC directly. Until an approval number is given to us by HMRC, we are legally obliged to deduct tax from your rental income at the prevailing rate which is currently 20%. This money is forwarded to HMRC on a quarterly basis. If the tenant pays you direct and he has not received approval from HMRC to pay the rent gross he must deduct tax and forward that to HMRC on your behalf. No person is exempt from this scheme.