Decoded: how to keep on top of tax changes as a landlord

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1 Oct 2018

Decoded: how to keep on top of tax changes as a landlord


Taxation is just one area of being a landlord which has seen major changes in the past few years. Stamp duty, income tax relief and capital gains tax have all been the subject of new policies and it can be a struggle to stay on top of all this new legislation.


Most of the key dates have remained the same, however, and these are printed in the minds of most business owners, who know that the tax year runs from 6th April ti 5th April the following year.


Here are some other key dates:


  • 5th April – the end of the tax year. You can submit a tax return any time after this date; you don’t have to wait for the deadline
  • 5th October – for new landlords, this is the deadline for registering for self-assessment for that tax year
  • 31st October – midnight is the deadline if you’re submitting a paper tax return
  • 31st January – midnight is the deadline for online tax returns, which can be submitted a little later
  • 31st January – all tax owed must be paid by this date (plus half of the next tax year if you are required to make payments on account*)
  • 31st July – midnight is the deadline for the second payment, if you make payments on account*


*Making payments on account


Some landlords are required to pay their tax on account, paying the tax which is expected to be due in the following year, in advance. This is currently the case if your tax bill is more than £1,000.


The tax is assumed to be the same amount as the previous year and can be paid in two instalments – the first half by 31st January and the second half by 31st July.


It is the transition from paying tax in arrears to paying on account which can cause issues for some landlords, especially if you want until the deadline before submitting your tax return. Finding out at the end of January that your tax bill is over £1,000, and you’re expected to pay half as much again at the same time (as well as the accountant’s bill) can come as an unpleasant surprise, so submitting your return early can give you time to budget. You can get your return for the 2017/18 year completed and submitted now, but won’t need to pay the bill until 31st January 2019.


You won’t have to pay on account, however, if you have already paid more than 80% of the tax you owe via your tax code or through interest on savings.


For more information on how to keep on top of tax changes for landlords and for advice on sound property investments, contact your local Romans’ lettings branch.


See more:

Decoded: Taxes Payable By Landlords And Property Investors

Decoded: Accounting And Ownership For Property Investors




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