When it comes to construction, and buy to let business, there are innumerable transactions and trade involved in the process of selling, buying or renting a property.
In real estate business, the accountant’s requirement, therefore, is vastly different from other business.
That’s why companies, individuals, and organisations dealing in property need to hire specialist property accountants for the best and most professional services.
Regardless of the size of the property, it is better to hire the professional services of an accountant to manage various issues of accounts.
There’re numerous benefits to working with property accountants, let’s know in details,
Table of Content
A Property Accountant Keep Accounts In Order
To know about the success of your real estate or property business, you need your accounts in order.
It is challenging to keep track of property-related expenses such as maintenance, paint, repairs etc.
And for this, you need to have an accurate view of what’s coming in and going out of your property business.
An experienced property accountant will keep a complete record of property-related accounting information and turn them into meaningful rental reports.
Help in Capital Gains Planning
If you want to sell a property that is not the permanent place of your residence, then it will be subject to capital gains tax.
You’ve to pay a share of the proceeds from that sale of your property to the government.
For such situations, an experienced property accountant will help you plan tax so that you incur maximum tax savings.
Non-resident Landlords (NRL)
Non-resident landlords (NRL) who own properties in the UK but remain overseas for more than six months a year can also benefit from hiring property accountants.
All Non-resident landlords are required to fill the UK tax return in order to calculate their tax liability and deduct tax at source.
Also, their letting agent or the tenant required to conform to this NRL scheme.
If you’re a letting agent, then you must deduct a basic tax rate from your client’s rental income before passing it onwards.
If in case, a non-resident landlord does not have a letting agent and the rent is exceeding £100 /week, the tenants need to deduct tax before the rent payment.
A property accountant will help the Non-resident property owner know how to save on taxes.
For example, the NRL scheme can apply to get the exemption of their property being deducted at source, but this needs working out with a specialist property accountant.
- Help You Save Tax
Landlords can benefit from hiring specialist property accountants to save taxes.
By applying experienced knowledge, your property accountant will be able to devise a strategy which is customised to your specific situation and should allow you to reduce your tax bill.
There are many expenses that landlords can be claimed against their taxable rental income.
These expenses must be for the purpose of renting out your property but can cover a wide range of costs.
Some common types of deductible expenses include:
- Water, gas, electricity and council tax bills
- Letting agency fees
- General maintenance and repairs to the property
- Finance costs
- Landlord’s insurance
- Accountants fees
- Wages of people providing the service for the property such as cleaner or gardener
The list above is not an exhaustive list for more information on what does and does not class as an allowable expense, visit Gov.uk.
Some property owners may be aware of all these expenses that they could claim for. However, some may not be aware of.
A specialist property accountant will guide a landlord to ensure all expenses that can be claimed are being claimed.
Read our blog: A guide for landlords to pay and save tax for details in tax savings.
- Guide You If Legislation Changes
Significant changes in tax rules might be easy to follow by your own, but the effects of seemingly small additions of changes might catch you off guard and surprise you down the line.
No matter what tax legislation changes the future throws at landlords, specialist property accountants will be ready to tackle them.
Property accountants will make sure no sneaky tax changes slip into effect without your knowing.
So, doubtlessly this is one of the most liberating advantages of hiring a specialist property accountant.
- Help You In Planning For Future
Finally, a great advantage of hiring a property accountant is having access to an expert whenever there are any business decisions to be made.
A property accountant is able to supply you with up-to-date financial information about their business which will allow you to plan for your future.
For example, although you may have purchased a property for the sole purpose of renting, there may become a time when you want to sell the property.
A specialist property accountant will be able to help you prepare for such eventualities and be able to advise accordingly to discuss the best options.
As a landlord, you may decide to invest in more property.
If this is the case, a specialist property accountant will be able to guide you through the process, help you understand whether you are in a suitable financial position, what your budget should be and more.
Final thought
As mentioned above, in this small area of property accountancy alone there are numbers of issues to consider before you have peace of mind that you are meeting all the tax obligations and making the most from your investment.
Hiring specialist property accountants in London can ease the task of managing properties.
