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I look forward to seeing the figs
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
When you say just under 40% bracket are you allowing for the effect of S24?
You could only deduct 25% of your mortgage payments last year and next year it will be zero. I pay ~£15kpa in interest. So with the band at £50k a net income of £35k would be enough to push me into higher rate. I was near the limit so I switched to buying through a company..So far I have only taken a small dividend with most of the profits going to expand the company. I plan to stop expanding and start paying into my pension which will be tax free, I am over 55 so could access it if necessary. I am also looking to reduce the mortgages in my own name, as I am taking some DB pensions, which might push me over the threshold (unless Boris increases it as he said he would).
I am Looking at my company in a very similer way to yourself
I cant see myself withdrawing Dividends or Salary as I am a 40% tax payer
But Using it to fund a Pension is a great advantage My wife is a 20% Tax payer so I pay her a Salary via the company up to around 8K a year
My own opinion is holding property in a company is second best for most investors
It has limitations other than a small salary and pensions if a Director is a 40% Tax payer
20 years ago I thought my paying into a pension was over
But times have changed and now I am Maxing out my pension planning now
and with the new rules your SIPP can be passed onto who you want on your death
so your loved ones can have a Nice Investment Company and a Nice pension pot when you have gone
So it can work well as long as you understand the rules
Tony, he's in the basic rate so there is no s24 impact at the moment.
Yes he needs advice.
Chartered Accountant, Tax Advisor and Mortgage broker
(and BTL portfolio owner)
Id be interested in the basis of the statement re ltd company. Ive looked at this and do appreciate there are alternatives but i cant find any that mainstream accountants think are safe.
For alternate schemes such as yours, who underwrites it, what is underwritten and have you had any challenges to date?
Thanks for getting back to me.
Everything we do is based upon HMRC practice and guidelines and fully in line with government policy. Moreover, in addition to the usual professional fees insurance we carry £2m per matter professional indemnity cover; being: -
Professional Indemnity insurance covers professionals for losses and defence costs if they provide inadequate advice or services that cause a client to lose money.For example the policy covers the following areas but is not restricted to:-i) Tax dueii) Legal Feesiii) HMRC assessments &iv) HMRC penalties
We do not promote tax schemes, and our 'alternate solution' is a legitimate business structure.
Likewise, mainstream firms as you put it are simply sector specialists and do not have our experience.
HMRC have looked at one of largest clients and concluded that the arrangements met with their requirements. That particular business is now floating on AIM.
Founding Director, for and on behalf of
Less Tax For Landlords
0203 735 2940
Another small thing, which people might consider to be of some significance, is that Mr Gimple and his associates operate in a huge office building where HMRC occupy probably 80% of it.
Hi David,Seek professional advice and also see our compilation thread - Resources for reducing landlord tax liability - it has some useful advice from PT tax partner, Rental Income Tax Advisors.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
This site covers the common allowances:
I'm not aware of any specific allowance for social housing or disabled tenants, however if you provide supported lodgings you can receive up to £10k pa per person plus up to a further £10k pa tax allowance:
There are also 2 allowances on interest received on investments, up to £1k pa Personal Allowance and up to £5k pa Starting Rate for Savings:
A good teacher must know the rules; a good pupil, the exceptions.
Martin H. Fischer