Property accountants
Property accountants for landlords, investors and developers
Investing in residential and commercial property is now commonplace. However, the legislation around expenses, allowances and reliefs is a constantly shifting landscape that requires careful consideration, especially when it comes to tax.
Tax planning for landlords
We help landlords with their tax planning requirements, and represent a wide spectrum of property owners who are using property to produce income in a number of ways including –
- The ‘Room to Rent’ scheme
- Holiday lets
- Buy-to-let portfolios (including HMOs) used for pension purposes
- Multiple property blended portfolios (mixing residential & commercial properties and land)
- Family investment companies used as part of inheritance tax planning
We help keep landlords on track with what costs and expenses they can claim, and how to maximise allowances to minimise the impact on their income tax liability. This includes supporting landlords to make the change from Self Assessment to Making Tax Digital for Income Tax (MTD) that will apply from April 6th 2026 for those with qualifying income of over £50,000.
The best structure for your property business
We have considerable experience in helping property investor clients to structure their portfolios effectively according to their circumstances and goals. This might mean creating a limited company due to the way that mortgage interest is treated within them and the fact that corporation tax and dividend tax rates are lower than the income tax rate for higher-rate taxpayers. As with anything tax related, there will be advantages and disadvantages which makes seeking expert advice so critical to determine whether buying property through a limited company is tax-efficient for individual circumstances.
Other tax issues
Property developers are likely to be affected by the Construction Industry Scheme, where they subcontract work. You need to ensure that the correct amounts are deducted from the subcontractor and are reported and paid to HMRC. We can assist with compliance and record keeping for this. Gains on disposals of residential properties in the UK which generate a capital gains tax liability require to be reported to HMRC within 60 days. This is often overlooked but we can calculate the gain and assist with the reporting to HMRC.
Tax advice for property investors
There are many elements of UK tax that need to be considered when dealing with property. With years of experience accounting for and advising clients industry-wide, we pride ourselves on understanding the problems faced by landlords, developers and investors, and developing effective solutions for property beginners and veterans alike.
Free initial consultation
If you would like to discuss your property matters with an experienced property accountant and find out how we can help you, please ​email Carrie Campbell at carrie@thomsoncooper.com or call 0131 226 2233.
Check out our Property & Landlord Hub for all the latest property news, articles and factsheets to keep you up to date.
Friendly, professional service
“Thomson Cooper provide a friendly, professional service.”
– Marjorie Scott, Director, Campion Homes
Frequently Asked Questions About Rental Income Services
What expenses can I deduct from my rental income?
You can deduct certain expenses from your rental income before calculating your tax liability. These expenses can include:
· Mortgage interest (limited by the finance costs relief restriction)
· Property maintenance and repairs (but not improvements)
· Utility bills (if you pay them)
· Council tax (if you pay it)
· Landlord insurance
· Letting agent commission/fees
· Accountancy fees
· Ground rent and service charges
What is the property allowance?
The property allowance allows up to £1,000 of property income to be received tax-free each year.
· If your gross property income is less than £1,000, you do not need to tell HMRC or report the income on your tax return (although you may want to complete a tax return if you have losses to claim).
· If your gross property income is more than £1,000, you can use the allowance by deducting the amount from the property income on your tax return (instead of deducting actual expenses). The property allowance cannot be used to generate a loss and you cannot deduct any other property expenses if you claim the property allowance.
What is the Rent a Room Scheme?
Do I need to report overseas rental income?
Yes, if you own property outside the UK, you must report rental income from overseas on your UK tax return. The UK has Double Taxation Agreements (DTAs) with many countries to prevent paying taxes on the same income twice.
What is Capital Gains Tax (CGT)?
How do I report my property sale?
There is a reporting requirement relating to the disposal of UK residential properties which give rise to a capital gains tax liability. A property that has always been used as your main home will generally be fully exempt from capital gains tax.
· Many UK residential property disposals will now need to be reported to HMRC within 60 days of the disposal. Any capital gains tax due will also need to be paid to HMRC within 60 days. The 60-day reporting requirement applies from the date of completion. HMRC charge penalties and interest for a failure to meet the deadline.
· HMRC have launched a new online service to allow reporting; the service allows Thomson Cooper to make submissions on behalf of our clients.
· Non-UK residents – If you are not resident in the UK there is also a regime in place that requires all properties, residential or commercial, to be reported to HMRC within 60 days. Unlike for UK residents, this is regardless of whether any capital gains tax is due.
What are the potential tax penalties for not declaring rental income?
Failure to declare rental income can result in penalties from HMRC. Penalties depend on the severity and length of the non-disclosure and can include fines, back-dated tax payments, and interest.
What should I do if I've underreported my rental income in previous years?
Can I deduct expenses for a property that is temporarily vacant?
Should I transfer my rental business into a company?
Tax is just one part of this decision and there is not a general rule of thumb. The difference in tax rates and treatment of mortgage interest along with the ability to retain profits for reinvestment and additional flexibility in estate planning are all potential benefits of holding properties in a company. The CGT, LBTT (Land & Buildings Transaction tax) and ADS (Additional Dwelling Supplement) which can arise on a transfer to a company are often prohibitive and/or disproportionate when considered next to any potential savings.
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