Why buy-to-let landlords need a property accountant

A very resilient investment option, property remains a popular vehicle for individuals wanting their assets to realise a healthy return. To help cover the costs of maintaining a property, many are purchased on a buy-to-let basis, so that the tenants contribute towards paying mortgages and generating a profit. Here’s a quick summary of what landlords need to understand about buy-to-let finances, and how a specialist property accountant could help.

The basic financial requirements of a landlord

Like any business, a buy-to-let property allows you to generate a profit, and to make certain deductions as running costs. Any profit left over is then subject to tax. If you are registered as an individual, tax on profit is paid as income tax; if the property is managed by a business, you are liable for corporation tax.

You will of course need to keep track of incoming rent payments, as well as full details of expenses incurred carrying out routine repairs, along with details of insurance and mortgage payments you make yourself.

How a buy-to-let property accountant can help

The additional overheads of running your accounts can be quite high, further eating into your profits. To help minimise your costs and maintain a healthy business, you should consider hiring a specialist property accountant who can not only help you balance the books, but who understands the buy-to-let market, and how to best manage your finances.

A buy-to-let specialist will also be able to advise about legitimate expense claims, and any allowances or relief you may be able to claim that will help maximise profits and minimise tax liabilities. A property accountant is also able to provide advice on how your profits can be reinvested to create additional revenue, in a way that a general accountant cannot.

For more help and advice about property accountant services, please get in touch with our team at 3 Wise Bears, and we will be happy to help.