How Rental Income is Taxed for UK Property Investors (In Personal Names) 👨‍🏫 📈 For individuals owning rental properties in their personal names, understanding the taxation process is essential: How It Works: Your rental income is combined with your overall income for the year and taxed at the following rates: • 20% for basic-rate taxpayers • 40% for higher-rate taxpayers • 45% for those in the additional rate band Mortgage Interest Rules Have Changed! Section 24 of the Finance (No. 2) Act 2015 is a UK tax law that limits the amount of tax relief landlords can claim on mortgage interest. Effect: You can no longer fully deduct mortgage interest from your rental income. Instead, you will receive a 20% tax credit on your mortgage interest payments. Impact: Higher-rate taxpayers face increased tax liabilities on their rental profits. What Can You Deduct? You can lower your tax obligations with these allowable expenses: - Repairs and maintenance - Letting agent or accountant fees - Landlord insurance - Utility bills that you cover Pro Tip: If your portfolio is expanding, consider whether holding properties in a limited company could offer better tax efficiency. Join Derbyshire and Yorkshire's most exclusive property club. We SOURCE 🎯 We SUPPORT🤝 We MANAGE 🏡 We CONNECT ❤️ DM the word VIP All investing carries risk Always seek independent financial advice #PropertyInvesting #RentalIncome #TaxTips #UKLandlords #BuyToLet

Posted by James Lovell-Smith at 2025-01-25 12:33:31 UTC