X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Tax

    Mileage and Buy to lets

    I am sorting out my tax return and looking at claiming mileage for visiting / inspecting my let property - one house quite far away - that I let out whilst working full time PAYE.

    On HMRC site it says -

    You can’t use the mileage rate method to calculate motoring expenses for your rental business.

     - but I had thought that was exactly what you did if it weren't a business but one property let.  But it doesn't differentiate any different anywhere else on the site that I can find.

    I would appreciate any thoughts? Thanks in advance.

    0
    0

    Thanks for posting that link "Joe".

    It would be interesting to see how that turns out and when it will be implemented assuming it does go through.  It would certainly make my life a lot easier.

    1
    0

    According to the HMRC you are a business, are not orr a business or maybe a business depending on your activity - all at the same time. Different parts of the law use different definitions of "business".. For the part you quote i suspect it doesn't matter and you can't use mileage rate anyway.

    0
    0

    Hi

    I had one BTL property and have then bought a second.  Can I claim mileage whilst looking for the second property as an expense allowance on my tax return?

    Thanks

    0
    0

    Hi Wanda,

    My understanding is that you cannot use the 45p mileage rate (despite the fact that this is exactly what it was designed for!) to charge for "business mileage" for a property business as a landlord, but you can as a Ltd company.

    The remedy is to calculate you annual motoring costs as below:

    Total miles 216/17 tax year 12,000

    Servicing £500

    Maintenance £500

    Petrol £2,500

    Road tax £200

    Insurance £500

    Total £4,200

    Then you apportion: E.G. 35% of your mileage was on exclusively on property related travel. You can put £1,470 (35% of £4,200) in your tax return as a part of your "expenses"section

    Paul

    0
    0

    Hi Paul

    Thanks for your reply and for how to calculate the mileage.  HMRC technician said I couldn't claim mileage whilst looking for another property but only the mileage used to inspect, repair etc.  I thought I'd read somewhere that you could claim mileage to expand your property portfolio once you  have one property but tbh it's so confusing with different info available!!

    Thanks again and I will certainly use your calculation tool.

    best wishes

    Wanda

    0
    0

    Hi Wanda,


    Sorry I have only just seen your reply. I am not convinced that the HMRC tech is correct. This is from the HMRC site:


    Other common types of expenses you can deduct if you pay for them yourself are:

    • general maintenance and repairs to the property, but not improvements (such as replacing a laminate kitchen worktop with a granite worktop)
    • water rates, council tax, gas and electricity
    • insurance, such as landlords’ policies for buildings, contents and public liability
    • costs of services, including the wages of gardeners and cleaners
    • letting agent fees and management fees
    • legal fees for lets of a year or less, or for renewing a lease for less than 50 years
    • accountant’s fees
    • rents (if you’re sub-letting), ground rents and service charges
    • direct costs such as phone calls, stationery and advertising for new tenants
    • vehicle running costs (only the proportion used for your rental business)

    Expenses you can’t claim a deduction for include:

    • the full amount of your mortgage payment - only the interest element of your mortgage payment can be offset against your income
    • private telephone calls - you can only claim for the cost of calls relating to your property rental business
    • clothing - for example if you bought a suit to wear to a meeting relating to your property rental business, you can’t claim for the cost as wearing the suit is partly for your rental business and partly to keep you warm - no identifiable part is for your property rental business
    • personal expenses - you can’t claim for any expense that was not incurred solely for your property rental business

    If you are renting out properties, and acquiring new ones then you have Research costs finding them, these will include travel, phone calls post etc.

    Frankly, when you put expenses in to your return, as long as they are reasonable, it is unlikely that HMRC will ever inspect you. Do not be tempted to inflate your overall motoring costs, and apply a fair percentage of business use (I keep a weekly log of mileage in a note book). I can produce bills for servicing/Maintenance and petrol, and my and prove total mileage. My notebook justifies the % of business mileage I apply.


    Paul

    0
    0