What Advantages Come with Hiring a Landlord Accountant?

When managing rental properties in the UK, appointing a landlord accountant can be a valuable asset. Landlord accountants are professionals who specialise in providing accounting and tax services to landlords, helping them to manage their finances and taxes efficiently.

Alternatives For Limited Companies and Sole Proprietorships

Whether a landlord is a sole proprietor with a few buy-to-let properties or a limited corporation with many, landlord accountants offer various services suitable for all landlords. Regardless of how many properties you own, hiring a skilled landlord accountant could save you time and money. 

The most important thing an accountant can assist you with is developing the operating structure that best meets your needs and the arrangement with which you are most comfortable.

Assistance Right Away

Hiring a landlord accountant could help you learn all the knowledge you need to succeed in the real estate business, allowing you to proceed with complete assurance. Given the quantity of highly regarded Whiteleys accountants in the UK market, you also have many options.

‍Whenever You Require Help

One of the best benefits of hiring an accountant is on-demand assistance. The majority of accountants offer free, ongoing phone and email support. But be sure you are aware of their operating hours.

Setting Up a Special Purpose Vehicle (SPV)

Consideration of creating a special purpose vehicle, a firm formed especially for directors to operate a buy-to-let business, is growing in popularity. Creating an SPV has a ton of advantages, such as:

• More Mortgage Options: Lenders of buy-to-let mortgages usually prefer corporate vehicles since they are easier to understand and have more effective underwriting.
• Tax-Efficiency: In the UK, the most tax-efficient method to operate as a landlord is as a director of an SPV. This is because limited firms, which are more profitable than sole proprietors, are subject to corporations' tax rather than capital gains tax.
• Greater Control: Whether you own an SPV, you have more financial freedom and may decide when to withdraw funds. Depending on your specific situation, this can further lower your tax obligation.
• More Capital: When an SPV is used, retained earnings are not taxed, giving you more money to put back into prospective buy-to-let properties.
• Limited Liability: When your business operates as an SPV, you will be subject to less liability and have better protection against potential monetary hazards.

You might feel confident managing your properties if you work with a certified landlord accountant to design and run an SPV. A landlord accountant will guarantee you are running as efficiently as possible concerning taxes, reducing your administrative burdens and boosting your value and profit.

Due to changes in Making Digital Tax legislation, landlords will have more obligations.

Landlords who earn more than £10,000 per year will have to abide by the new Making Tax Digital (MTD) regulations starting in April 2024. 

The new laws require you to provide quarterly updates on your income and expenses through an HMRC digital tax account, where tax data is processed in real-time. 

You must sign a declaration attesting to the integrity of your quarterly reports rather than submitting a self-evaluation. You must pay your taxes by the end of January of the following year.

Don't panic if the idea of having additional MTD commitments makes you uneasy. First, understand that you are not alone because this will impact many landlords in the UK. Second, the official website of the government is an excellent source. 

Thirdly, employing a landlord accountant would probably lessen your load, and they will be eager to offer you the help you require. Accountancy services may assist you with the MTD setup, the quarterly filings, your self-assessment, and other things (if you have additional sources of income).

Support For Ongoing Legislative and Tax Laws Adjustments

Stamp duty, capital gains tax, income tax, and national insurance payments are just a few of the taxes and regulations landlords could have to deal with. A reliable and skilled accountant will ensure that you pay the right taxes and follow the applicable laws.

Law changes can be annoying and challenging to comprehend. They are a fundamental part of paying taxes in the UK, though, so it is doubtful that they will end very soon. Maintaining current knowledge of rules and regulations will be crucial for competent accountants. They can provide their clients with accurate information as a consequence. Selecting an accountant with a solid reputation will place you in the best possible position.

‍Conclusion 

Appointing a landlord accountant in the UK can provide many benefits to landlords. They will be able to save time and money and ensure that all their financial and taxation matters are taken care of correctly. Landlord accountants can also provide landlords with guidance, advice, and support for any legal or tax matters that may arise. This can be invaluable for landlords, especially those new to the industry. With the help of a landlord accountant, landlords can be confident that their financial affairs are in safe hands.

1 to 1 Accountants is an accountancy firm based in the UK. We primarily serve small businesses and freelancers. Contact Whiteleys accountants today!