Planning for the end of the tax year
If you operate an owner managed private company, you can utilise the £2,000 tax free dividend allowance. As dividends are taxed based on the UK tax bands, have you considered taking an additional dividend from your company to maximise this limit? (UK tax payers have a basic rate band £6,570 higher than Scottish tax payers.) For more information contact our Taxperts at EQ Accountants.
Deposits – taxable or not?
The treatment of rental deposits varies depending on what happens at the end of the rental period. If the deposit is fully returned, it should not be treated as taxable income. However, if any proportion of the deposit is retained to cover costs, such as damages or cleaning, the retained element should be included within taxable income. You may save tax by ensuring that your deposit receipts are treated correctly. For more information contact our Taxperts at EQ Accountants.
HMRC Let Property Campaign
If you are a landlord who owes tax on undeclared income from letting residential properties (including holiday letting) did you know that you can use the HMRC Let Property Campaign to help you get caught up on your tax affairs? The penalties for non disclosure can be up to 100% of the unpaid liability so it is important that you correct any previous errors or omissions as soon as possible. For more information contact our Taxperts at EQ Accountants.
Thinking of selling your business?
If your property qualifies as a furnished holiday let, there are various capital gains tax reliefs that may be available to you. For example, entrepreneurs’ relief, where the rate of tax could be reduced to as little as 10% of the overall gain, in comparison to 18% or 28% if it is a residential investment property. Therefore, it is important to establish whether your property fits the criteria for furnished holiday letting in order for you to utilise these reliefs. For more information contact our Taxperts at EQ Accountants