Do Landlords really need an Accountant?

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Written By LawrenceGarcia

Demystifying the world of finance, one article at a time.





Landlord tax accounting is becoming an increasingly complex area. Many landlords, both new and experienced, are turning to landlord accountants for assistance. But what do they do, and do landlords really need professional help?

Do I need an accountant for investment property?

Purchasing an investment property, through whatever means, is dependent on your financial situation – something that you would seek financial advice about. So, it’s only logical to seek financial advice and support for the taxes on your investment, especially as these investments are subject to their own specific taxation rules.

For many landlords, rental income isn’t their primary occupation, so trying to be compliant and tax efficient can be a huge strain on time and resources. And not to mention that failing to consider taxation could cost you plenty.

What are the benefits of an accountant?

An accountant can advise you on everything from what expenses you can claim, the tax reliefs available to landlords, working out the tax credit on your loan interest to the accounting records you need to keep. So, whether you’re starting out or managing multiple properties already, hiring alandlord accountant is a step in the right direction.

There are also a few different things to consider depending on your current position as a landlord:

For first time landlords

Did you know that even if you don’t turn a profit as a landlord, you must still declare your income as a landlord?

If you haven’t yet purchased the property, you can get help to ensure you’re being as tax efficient as possible. A landlord accountant will be able to help you understand:

  • what you can afford
  • how to manage your finances according to your individual circumstances
  • how to comply with changing legislation over time

There are many aspects to landlord accounting that you need to be fully aware of before you start, so we recommend that you speak to an experienced accountant like Warr & Co, to make sure that you’re fully compliant and that you’re paying the least amount of tax possible.

For landlords already managing one or two properties

HMRC’s‘Let Property Campaign’aims to recover millions of pounds of unpaid landlord tax and relies on individuals voluntarily coming forward and setting things to rights. The problem? Most landlords don’t even know they’re not compliant.

For landlords of a property within a block of flats

You may want to think about setting up a flat management company, which helps residents to manage shared expenses such as insurance, roof repairs and communal cleaning.

In a typical company, each owner of a flat will have one share in the flat management company. The residents elect directors to deal with the formalities of the company, including setting an annual service charge that every flat owner will be required to pay.

These companies, governed by the Companies Act, must prepare and file annual accounts. An accountant can help with setup of these companies, and can offer the following ongoing services:

  • Submission of annual accounts to Companies House
  • Submission of company tax returns to HMRC
  • Annual tax returns
  • Managing service charge accounts with stakeholders and tenants
  • Proactive tax and legislation advice

At Warr & Co, we currently act for around 100 such companies, so have plenty of experience in this area of landlord accounting.

How do I find a good property accountant?

Regardless of your position as a landlord, everyone can benefit from working with a specialist accountant.

Our team of landlord accountants and flat management accountants specialise in this area of tax and can provide a comprehensive service, ensuring you stay compliant and tax efficient. We offer a straightforward, honest service with no unexpected fees – just the type of quality service you’d expect from a small but highly experienced team.

Start your journey today and get in touch for a free, no-obligation consultation.