Buy to let investors must make the most of mortgage tax relief on offer

Posted under Advice by Alan

Buy to let investors should ensure that they claim all their tax allowances. It is imperative to keep in mind that the taxman will treat investment property in much the same way like any other business. A buy to let investor can stake a claim for tax relief against rental income for most of his or her running expenses, comprising agents’ fees, repairs, and any utility bills that he or she pays apart from a general allowance of 10% of rental income for wear & tear if the property is furnished. This can largely cover the cost of sofas or beds, television sets, freezers and fridges, floor-coverings and carpets.

You should try to make the most of mortgage tax relief on offer. In fact, your biggest expense is in all likelihood to be mortgage interest. Landlords are required to pay tax on their respective rental income. However, the amount of mortgage interest paid can well be offset against this income for reducing your tax bill.

Of course, prior to worrying about the financial aspects, first and foremost, a buy to let investor should strive to make the property attractive – with necessary add-ons. This is the most vital piece of advice that investment advisors often give to their customers. Make your property ‘genuinely attractive for viewers’ - functionally and in terms of looks as well.

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