When it comes to property investments and tax there are 3 main things to be aware of:

  • You must declare the income to the inland revenue and may need to pay income tax on it.
  • capital gains tax.
  • You should always seek tax advice from a qualified tax expert

NB: Mortgage Compare Limited are not able to give you any advice on taxation. Details on our site are for general information and cannot be deemed as any advice. We strongly recommend you seek independent tax advice.

Tax deductions

Usually you can claim expenses relating to your rental property for the period your property was available for rent (your accountant or the Inland Revenue will be able to advise on up to date allowable deductions).

Below is a list of expenses you may be able to claim:

  • Advertising for tenants, agents fees and commission.
  • Interest payments and loan fees.
  • Council rates, service charges and management fees.
  • Depreciation of items such as stoves, fridges and furniture.
  • Repairs, maintenance, pest control and gardening.
  • Building and landlords insurance.
  • Stationery, phone costs and any travel to inspect the property.

Capital gains tax

What the Government gives with one hand, it takes with the other. Capital gains tax is a tax on the profit you've made on the property. So it's based on the difference between what you sell it for and what it cost you (the purchase price plus anything you have spent on capital improvements or renovations).

Continue to information about managing your investment.

Common Mortgage Broking questions

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The guidance and/or advice contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK.

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