As Tax Accountants, we have helped many landlords or properties owners with filing their Self-Assessment Tax Return. Rental income is taxable income and therefore HMRC expects landlords to declare the rental income and submit a tax return to HMRC every year. If you own a several properties and you decide to sell one of the properties, you are required to pay Capital Gains Tax by filing a Self-Assessment Tax Return.
Are all Landlords required to submit a Tax Return?
Yes, unless your rental income for the year is only £1,000 (gross income) or less you do not have to file a tax return but need to notify HMRC to avoid any penalties. Gross income is the rental income before any property-related expenses are deducted. If you just recently purchased a property to rent out to tenants (buy-to-let), or receive overseas rental income, get in touch and we can help you register for Self-Assessment (UTR) and assist you in filing your Self-Assessment Tax Return.
What if I do not declare my rental income?
Well, not declaring your rental income to HMRC is considered as Tax Evasion which is illegal in the UK. So for peace of mind, it’s always good idea to declare any income on which no tax has been paid so you do not end up to avoid paying any penalties or interest charges later on when HMRC does a compliance check and impose penalties on the tax that should have been paid previous years.
- Income Tax (basic, higher, additional rate tax payer)
- National Insurance Contributions (NIC)
- Stamp Duty Land Tax (only when buying or selling property)
- Capital Gains Tax (only when buying or selling property)
All landlords have to pay income tax on the assessable rental profits and pay 20% income tax as a basic rate tax payer (up to 37,500 for 2019/20). National insurance contributions will depend on the age, e.g. pensioners do not pay any national insurance contributions but have to pay income tax.
How we can help?
We have vast experience in helping landlords and properties owners in filing their Self-Assessment Tax Return. As authorised HMRC agents we can take the administrate burden of filing your tax return and we can provide with the following services:
- We can help you to register with HMRC and ensure you do not receive penalties for late notifications charges.
- Prepare Self-Assessment Tax Return accounts
- Produce SA302 Tax Calculation
- Advice on the required payments & payments on account
- Liaise with HMRC with regards to any tax or payment issues
- Notify you on any payments on accounts due