Top three buy-to-let tax mistakes
Not keeping receipts for money spent, including buying and selling costs is a no-no. No receipts, no relief.
A good filing system is an important part of being a landlord. If you use online banking, print off statements regularly as it can be hard or costly to access them further down the line.
You should also have a separate bank account for your property letting business and pay all the rents into this account and take all expenditure out of it.
2. Tax relief
This refers specifically owning a property 50/50 but trying to claim tax relief for lower tax earner at 90/10. Put simply, you can't do it. The tax relief you claim must reflect the ownership of the property.
3. Costs and benefits
Setting up a company to hold property in without fully understanding the cost/benefits: there is no way to avoid paying certain taxes, although various ways to reduce your liability. Owning a property through a limited company will have pros and cons depending on your personal circumstances, how long you own the property for, when you need to access the money and how it fits in with your wider tax planning.