It’s been almost six weeks since the 2013-14 tax year ended, but most landlords will not have even started to think about their submission to HMRC. We recommend that you don’t put it off for too long, with up to £1,600 of penalties at stake it’s worth avoiding a last minute panic.
While the earliest submission deadline is not until October, preparing all the necessary figures and finding all the relevant documents now can prevent stress and avoidable fines later. It’s also a great time to call the free helplines and find out information from the staff now before they get stressed and over-busy. For instance, you can find out which expenses are relevant and if you are the only one who needs to submit a return. A mistake that is especially common among the newer, ‘accidental’ landlords is forgetting that if a rental property is owned in joint names, both parties need to file a tax return—even if you are married.
If the task seems too big and that’s the reason you’re putting it off, take the first step by pulling together all the information about your income. This includes:
- The total rent you’ve collected in the last 12 months
- The total you’ve earned in your main employment (if applicable) over the tax year
- Any income from pensions or other investments
- The total bank interest you’ve received
- Next, think about the money you’ve paid out over the same period and start finding receipts and records for things like:
- The tax you’ve paid on your main wage (if you have another income)
- Your buildings and contents insurance
- Any maintenance or repairs you’ve carried out on your rental property
- Any interest you’ve paid on the property’s mortgage
- Any fees you’ve paid to letting agents, or other marketing you carried out to gain tenants
- Any utility bills you paid that were not included in the rental income
- Other fees like factors’ fees or solicitors’ costs.
These are only a few suggestions to help you make a start on your return. For accurate, up-to-date advice you should contact an accountant, tax adviser or phone HMRC directly. If you decide to employ someone to help you prepare your tax return, you could shop around for a good deal now. It may be a quiet time for tax advisers now, and they might be more willing to negotiate on costs now than when they are really busy.