-
It’s all pretty over my head to be honest. I think I need to meet with some sort of independent advisor. I’m not after profit, just mortgage covered, and yeah higher tax bracket before any rent so prob stitch up?
chrisbmx116-
It's worse that that; in some specific circumstances if you rent out a property it could actually end up with you subsidising the property. You really need to take a close look before you jump in.
-
I’m not after profit
It's strong yield* and capital appreciation** you want - two things that are hard to achieve if you are BTLing in London now.
Do you have an accountant? Who is doing your tax return?
* i.e. the profit from your cash outlay expressed in % - example you paid £100,000 for a property, cash £25,000, mortgage £75,000. You get £500 a month rent, and the mortgage costs £100 per month. There are no other costs. That leaves you with £4,800 a year which is a cracking yield before tax of around %20 (£4,800 is roughly %20 of £25,000).
** rising house prices
princeperch
Howard
You mean not being able to deduct finance costs from profits?
Examples here:
https://www.gov.uk/guidance/changes-to-tax-relief-for-residential-landlords-how-its-worked-out-including-case-studies
If you earn a lot and have high finance costs it might be a bit painful.