Whether you have inherited a property, or you are considering renting out your property, then you will most likely have some questions about financial responsibilities. Luckily, we have gathered a brief list of some of the different financial responsibilities that you need to consider when renting your property to tenants.
Investing your time into becoming a landlord is worthwhile. Not only does it mean you own a long-term asset, but it can also bring you an extra source of income which is why a lot of people decide this route.
Although it is nice to have that extra cash incoming, renting your property can also come with a list of risks, let’s take a look below at what we have gathered.
1. How Much Can I Charge for Rent?
There are many different sources that can give you brief guidelines for what to charge for rent but sites like Rightmove, Zoopla, On The Market, and Leaders are some excellent examples of reliable sources to calculate exactly how much rent you should be charging for your property. It will give you a unique breakdown of how and why that number has been calculated, which can be very relieving for first-time renters or those who need a refresher.
2. How Much Tax Will I Need to Pay on Rental Income?
The profits made after working out your expenses will most likely if not definitely be subject to HMRC tax. We highly recommend applying and submitting a self-assessment tax return to declare any profits made from renting your property. Do not forget to include all allowable expenses such as council tax, utility bills, insurance, and service charges as this could reduce the amount of tax you need to pay by offsetting them against your tax bill.
3. What Can I Do to Make the Process Smooth?
A great way to make the renting process smooth and fast is to provide a guide for your tenants. This way they can follow the correct compliances. The government has released a perfect How-To guide for landlords and tenants which you must give at the beginning of the tenancy. You must provide this in case of any legal complications later in your tenancy agreement.
Being a landlord can be stressful at times, but if you are on the hunt for some reliable and professional financial advice, look no further because MCC Accountants are here to help! We are a comprehensive accountancy practice who have over 200 different clients from all kinds of sectors, from limited companies to sole traders, we have 15 years of experience as a business to provide top-quality accounting advice that you won’t find anywhere else.
Our team of dedicated and highly skilled accountants can provide you with all you need to know about financial responsibilities within the landlord and renting industry. We are excellent at what we do, and this is reflected in our client feedback, we have been rated 5 stars!
For more information about the top accountants in Manchester, then please make sure to enquire today.