Further tax tips on Buy to Lets

A Non UK Resident Landlord

You may be working abroad for a few years and decide to let your main residence. Be sure to register with the Revenue as a "non-resident landlord", otherwise your letting agent (or the tenant, if no agent) will be required to deduct tax at 22% from the gross rents due to you and hand it over to the Revenue. Although you will be given credit for this in your tax bill for the year, it would be better in your accounts earning interest than in the Revenue's account!

Remember, you can still claim the personal annual tax allowance, currently £4,895, against this rental income even though you are not resident in this country.

Main residence letting

Whether you go abroad or move to another house in the UK, and let your former main residence, you will not incur capital gains tax, provided you sell it within three years of moving out.

If you decide to move to another house and let your main residence and you remortgage, you can increase the amount of mortgage interest that can be claimed by the increase in valuation of the property at the time of letting it.

Holiday homes

If you live for substantial periods of time in your home and your holiday home (which may be let at certain times of the year) you can increase the capital gains tax exemptions available by making the necessary elections for main residence. The first election must be made within two years of the purchase of the second home.

If you wish to discuss the above points please contact David Cane on 020 8390 6878.