If you are a Landlord and receive rental income in the UK then you will need to complete a self assessment tax return each year to declare your income. Whether you are a first-time landlord or a seasoned investor, the actual landlord tax return process is the same, and we can help you no matter how big or small your property portfolio may be. At UK Tax Returns we will prepare your accounts and liaise with HMRC on your behalf so that your tax affairs are always kept up to date
Sometimes life takes over, and if you have fallen behind with your tax returns for whatever reason, then there is an amnesty campaign run by HMRC specifically for Landlords. Under the Let Property Campaign we can assist you with making a disclosure to HMRC to address the historic tax years involved, and to settle any overdue tax which may be owed.
LET PROPERTY CAMPAIGN
FURNISHED HOLIDAY LETS
Furnished Holiday Lets (or FHL’s) have grown in popularity in recent year with the rise of various booking websites such as Air B&B. An FHL is effectively a residential property which is supplied fully furnished and is available for short term letting periods, such as self-catering holidays or work accommodation away from home.
Reporting of Capital Gains Tax has changed significantly in recent years. Under current rules you now have 60 days from the date your property sale completes to calculate the CGT position, report to HMRC, and pay any tax owed. If you have sold or given away any assets this could give rise to a CGT reporting requirement. We can ensure that your CGT liability is reduced to as low as possible by advising you on all of the allowable expenses and reliefs that you are entitled to claim.
PROPERTY CAPITAL GAINS TAX
If your combined earnings for the year are more than £100,000 then you will meet self-assessment criteria and be required to complete a tax return each year. The reason for this is because once you earn over £100,000 then you will start to lose entitlement to your personal tax-free allowance. The tax-free allowance for 2023/24 is set at £12,570; however, for every £2 that you earn over the £100k mark you will lose £1 of your personal allowance.
Generally speaking, if you are a UK resident then you will be liable to UK tax on your worldwide income – and this could be in addition to any tax you have already paid overseas. Unfortunately, some wrongly believe that if they declare their foreign income overseas and pay the associated tax, that they are fully compliant. This is not the case, and HMRC launched a campaign in the past known as the Worldwide Disclosure Facility to allow individuals to come forward and voluntarily disclosure their overseas income which has previously been un-taxed in the UK.
FOREIGN INCOME WORLDWIDE DISCLOSURE FACILITY
EARNERS OVER £100,000
As a UK-Resident you will be liable to tax assessment on your worldwide income. If you are thinking of leaving the UK to live or work overseas, it is likely that you will no longer be taxed as a UK resident. Meeting criteria to be taxed as a Non-Resident can have many tax advantages from the UK tax perspective. Often specific income sources, such as pensions for example, become exempt from UK tax once you become Non-Resident. Furthermore, depending on your destination country, you may find that the same income source is entirely tax exempt overseas.
If you, or your partner, earn more than £50,000 per year and you claim Child Benefit then you will meet criteria to complete self-assessment tax return each year. This is because if you have any earnings over £50,000 per year then Child Benefit starts to become restricted. Once your income is over £60,000 per year, you will lose the entitlement to this benefit altogether. You will lose 1% of the Child Benefit entitlement for every £100 that you earn over £50,000.