Why A Landlord Feels That A Letting Agent Is Indispensable?
By: Rentals London
All letting agents undertake heavy commitments and work in letting a property. They take care of all the mandatory requirements and processes while renting a property on behalf of the landlords. That way a professional letting agent takes out the stress of a landlord in areas like finding a tenant, handling property viewings, doing negotiations on rent and dealing with maintenance of property.
Generally Letting agents in London have responsibilities,
Promotion of property through online and offline marketing.
Negotiating rental price
Responsibility for legal documents.
Timely inspections to check the condition of the property.
Handle the concerns of tenants and address it to the landlord
Verifying tenant's credentials, references and credit status.
Collecting the rent on land lord’s behalf.
Handling tenancy agreements, and deposits.
Provide timely guidance and advice to the landlord
Tax Benefit of Hiring Letting Agents
In a way hiring a letting agent is a boon for a landlord as it can also reduce the income tax outgo as the owner can make a claim for legal and professional costs of running the property in terms of letting agent fee and solicitor's fees. Other claims are ground rent, insurance, and service charges while letting a property. There is also relief for any council tax paid, gas and electricity bills paid to tenants or at a time when the property was empty.
Helping Landlord with Tax Related Issues
There are letting agents in London who also render tax related advice to the landlords. It can be about filing the Tax returns pertaining to income from rentals in properties or even the basics of inheritance planning and adjust taxation burdens.
Sometimes lack of right guidance puts many landlords at the receiving end of HM Revenue & Customs (HMRC) who crackdown on errant landlords who may not have paid taxes on time knowingly or even out of ignorance on tax matters. So landlords get tips from letting houses or agents to ward off the bitter consequences of non payment of rental tax .
According to an analyst, HMRC is very tough on tax matters and use all tactics to gather information on landlords who have not declared rental income.
If sound tax advice is given there are many legitimate ways to save the tax bill.
Deduct a slew of expenses before tax is levied.
Take off all expenses of running the property.
Buy-to-let borrowers can subtract the mortgage interest from the rental income.
The whole of the monthly payments on interest-only loan can be deducted
In case of a repayment mortgage claim limits to the interest component only
Running Expense Vs Capital Costs
A letting agent will also make a landlord understand that there is a distinction between running expenses and capital costs. Income tax relief is allowed only on repairs and redecoration. But any kind of capital investments in a property is not eligible for tax relief. For example, if a landlord repairs the roof of his rental apartment he can set it off against the rental income, but if he puts a roof extension, it becomes a capital expenditure.
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