Investing your cash in rental properties is being perceived as the best way to save for retirement and boost your pension pot. If you have such an investment, you will be paying tax on your income from this source. If you want to offset that additional tax, you need to know about the tax advantages of rental properties.
Tax is a complex area and can be quite confusing for most people. However, if you want to take advantage of any tax benefits, you will need to have a basic knowledge of how it works. You will undoubtedly need the expert advice of a tax specialist to ensure you are receiving your full tax benefits.
Mortgages secured on the investment property will see you being eligible for relief of the mortgage interest. Any other loans you may have that have been used to effect repairs or maintenance also bring relief on the interest. Materials for repairs and maintenance of the property that you may have paid with your credit card attract interest and you can claim relief on it.
Managing a rented property may require a deal of travel, which has a cost attached. Providing your journey is as a result of managing the rental property, you can claim it as being taxed deductible. If you are arranging or overseeing work on the property, it has to be for repair or maintenance reasons. You cannot claim tax relief if work is for improvement purposes and is likely to affect the property value.
If this is your first investment property, you may manage it from a dedicated home office. In which case you are entitled to claim relief on a portion of the costs for running that office. A portion of your home utility bills and the cost of your equipment and supplies to operate your business can be included. However, you should take detailed advice on running a business from home.
Renting or leasing office accommodation to run a property investment business will also allow you to claim tax advantages. As with a home business you can claim on office equipment, sundries and utilities. If you share the office space with another company, you can only claim a portion equal to the space you are using.
Insurance for your properties and any staff you employ to manage or work in your business come under the category of tax deductibles. The same applies to any professional services you require to run your rental business. If you want to make full use of the tax advantages of rental properties, you would be well advised to take professional advice.
Tax is a complex area and can be quite confusing for most people. However, if you want to take advantage of any tax benefits, you will need to have a basic knowledge of how it works. You will undoubtedly need the expert advice of a tax specialist to ensure you are receiving your full tax benefits.
Mortgages secured on the investment property will see you being eligible for relief of the mortgage interest. Any other loans you may have that have been used to effect repairs or maintenance also bring relief on the interest. Materials for repairs and maintenance of the property that you may have paid with your credit card attract interest and you can claim relief on it.
Managing a rented property may require a deal of travel, which has a cost attached. Providing your journey is as a result of managing the rental property, you can claim it as being taxed deductible. If you are arranging or overseeing work on the property, it has to be for repair or maintenance reasons. You cannot claim tax relief if work is for improvement purposes and is likely to affect the property value.
If this is your first investment property, you may manage it from a dedicated home office. In which case you are entitled to claim relief on a portion of the costs for running that office. A portion of your home utility bills and the cost of your equipment and supplies to operate your business can be included. However, you should take detailed advice on running a business from home.
Renting or leasing office accommodation to run a property investment business will also allow you to claim tax advantages. As with a home business you can claim on office equipment, sundries and utilities. If you share the office space with another company, you can only claim a portion equal to the space you are using.
Insurance for your properties and any staff you employ to manage or work in your business come under the category of tax deductibles. The same applies to any professional services you require to run your rental business. If you want to make full use of the tax advantages of rental properties, you would be well advised to take professional advice.
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