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  • Tax

    Schedule A Income from Property - Employee?

    Hello everyone!

    Is it possible to use the profit from my current property portfolio (11 houses) to pay for a fulltime employee to:

    run/manage/take rents/chase rents/setup tenancies/do inspections/repairs/insurances/callouts/take calls/everything -etc./ - as well as renovate new property.

    I want to pay this employee from the profit I make from my Schedule A rental income?

    I currently make £52,000 a year rent, £34,000 mortgages - Total: £18,000 (My income from my main employment is £25,000 a year)

    I want to pay a handyman that I know - minimum wage for 37 hours a week (£14,430 a year) - so I don't even have to think about the property. He'll run the property business - while working on renovating more for me. And I'll get £3570 a year profit from the houses (increasing as each new property is added to the portfolio).

    Thanks for the help.

    Kim

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    I pay people to do that for me and deduct the cost. They are called letting agents. Generally they alos work for other people as well as, baring very large landowners, most people do not have enough properties to employ someone full time. It sounds though as if you want to employ him part time for this and part time for doing rennovations.

    Is he well versed in the law and regulations of letting?

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    Hi Kimbo

    First of all in tax terms the scheduler system was dropped several years ago so Schedule A no longer exists - except in the happy memories of people like me.  As for your question about employing one or more people to manage your portfolio the simple answer is yes you can do that.  However you should also factor in the cost of processing the payroll if you decide to outsource this and also the fact that you will have to provide them with a pension scheme under AutoEnrolment.

    Regards

    Nigel

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    I guess you would also need to factor in employer national insurance contributions, payments for holidays , sickness etc.

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