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Article by GoSimpleTax
A Unique Taxpayer Reference (UTR) number is a ten-digit code required by all sole traders, partnerships, and limited companies in the UK. It’s unique to that individual or organisation and remains unchanged forever.
You will also need a UTR if you have other forms of income or expenses that require you to file a Self Assessment tax return.
If you don’t have a UTR, you won’t be able to submit a Self Assessment tax return, therefore running the risk of upsetting HMRC. Plus, you may open yourself up to heavy penalties.
So, to help reiterate the importance of UTR numbers and how to correctly acquire your own, we’ve asked Mike Parkes from GoSimpleTax to shed some light on their role in tax return submissions.
What is a UTR?
A UTR helps HMRC identify and process tax returns against the correct taxpayer’s records providing them with a way to match records to payments. They can also use it to monitor for suspicious activity.
The UTR will be needed to complete a Self Assessment tax return, to pre-pay taxes in instalments and to work with an accountant.
Who uses them?
Any individual with self-employed income or income from rental property probably forms the biggest group that will need a UTR.
These individuals will need to perform a Self Assessment tax return. For other taxpayers, it may also be relevant when registering for the Construction Industry Scheme or working with an accountant.
How can I get one?
As you won’t receive a UTR number unless you’re registered as either self-employed or a new business, you’ll need to do so on HMRC’s website. Alternatively, you can call them on 0300 200 3310. There is no cost to doing either.
Be careful if you have already started trading. HMRC expects you to register within at least three months of the end of your first month in business. They will consider strict penalties if you fail to do so.
To avoid such fines, register as soon as you can with all the below information to hand:
Double-check that you have fully completed the process if you’re still waiting on your UTR following registration.
What if I’m already registered?
If you have previously registered or submitted a tax return you could find your UTR easily on numerous documents from HMRC, such as
Previous tax returns, payment reminders, notice to file tax returns, statements of account, the ‘welcome to Self Assessment’ letter SA250 or even stored in software should you use it to file your return.
In addition, your HMRC online account will also display the code, provided you can access it. If none of these options prove fruitful, contact the Self Assessment helpline.
Income, Expenses and tax submission all in one. GoSimpleTax will provide you with tips that could save you money on allowances and expenses you might have missed.
Our software submits directly to HMRC and is the digital solution for Landlords to record income, expenses and file their self-assessment giving hints on savings along the way. Covering all self-assessment pages, not just property, GoSimpleTax does all the calculations for you saving you ££’s on accountancy fees.
Available on desktop or mobile application.
The White Paper on the Renters’ Reform Bill, (to include proposals for improving Section 8 & abolishing Section 21) has been delayed for release until 2022. It was due for release in Autumn 2021.
As advised in the Queens speech, the Bill intends to “enhance the rights of those who rent”.
In a letter to contributors to the White Paper, the government said the delay would “not only allow us to benefit from continued work with the sector but will also allow us to carefully consider the findings of the National Audit Office’s review of regulation of the sector which is due to report in the coming months”. The government is also actively engaging with tenants – along with other stakeholders – to learn more about their experiences in the private rented sector.
The speech’s briefing notes set out what letting agents and landlords can expect from the reform package and include:
Abolishing Section 21 (known as ‘no fault’ evictions) thus improving security for tenants in the private rented sector, as well as strengthening repossession grounds for landlords under Section 8 when they have valid cause.
Outlining proposals for a new ‘lifetime’ tenancy deposit model that eases the burden on tenants when moving from one tenancy to the next, helping improve the experience of those living in the private rental sector.
Bringing forward reforms to drive improvements in standards in rented accommodation, including by ensuring all tenants have a right to redress, and ensuring well targeted, effective enforcement that drives out criminal landlords, for example exploring the merits of a landlord register and requiring all private landlords to belong to a redress scheme.
Considering further reforms of the private renter sector enforcement system so it is well targeted, effective and supports improvements in property conditions, including a set of measures to hold “bad landlords” to account for delivering safe and decent housing to tenants without penalising good landlords.
Exploring improvements and possible efficiencies to the possession process in the courts, to make it quicker and easier for both landlords and tenants to use.
The proposed legislation would only apply in England.
Article abridged from Goodlord
**SWLA Tradepoint members will get an extra 10% off these deals**
When – Wednesday 1st December 2021 10am
Where – Online
By – Goodlord (please note – this is not an SWLA webinar)
Subject –
• The Regulation of Property Agents (RoPA)
• Renters’ Reform Bill
• Live Q&A with Robert Bolwell (Senior Partner at Dutton Gregory)
If you would like to attend, register here; Lettings legislation in 2022: Looking ahead with Robert Bolwell (goodlord.co)
Wednesday 17th November 2021 at 11am
Ashley Taylor Solicitors will be reviewing the year, to register, click here;
https://us02web.zoom.us/webinar/register/WN_zZssp3BDS3mkJyqFApzRPQ
”A look back at all the subjects we’ve covered this year on our Webinars for Managing Agents and Landlords, a brief reminders of pitfalls and danger signs, rules, regulations and ways to avoid or minimise defences and keep the waters calmer!”
Information from PATH (Plymouth Access to Housing)-
https://frontlinenetwork.org.uk/ – click the log in button in top right hand corner of the page, then click ‘join the frontline network’ . This is a regular newsletter which includes the kind of training that workers in services like PATH do. Including around understanding trauma.
https://www.livewellswacademy.co.uk/courses/ – various training including conflict resolution and mental health awareness. Many courses have a cost involved.
Useful information for landlords: https://www.landlordzone.co.uk/information/how-can-you-support-your-tenants-mental-wellbeing-as-well-as-your-own/
Useful information for tenants: https://www.mind.org.uk/information-support/guides-to-support-and-services/housing/your-housing-rights/
PATH recently did a short survey with landlords and agents who regularly take people from PATH as tenants. They have had feedback that landlords and agents might like training around dealing with tenants (including in shared houses) who have poor mental health.
Poor mental health usually has its roots in trauma. The Trauma Informed Plymouth Network would be happy to offer a free 60 minute Introduction to Trauma course which would cover themes like:
What is trauma
How common is trauma
Signs and symptoms of trauma for individuals and communities
Stress responses to trauma – seeing behaviour as communication
Why an understanding of trauma is important
Responding to trauma with a trauma-informed approach
Please contact Vicky Brooks at vicky.brooks@NSPCC.org.uk if you would be interested in booking a place
Article by GoSimpleTax
There are about 2.66m private landlords in the UK and you could be one of them. Although renting out property can offer excellent returns, it involves a wide variety of expenses, big and small.
Thankfully, as you know, many costs can be claimed as “allowable expenses”, which buy-to-let landlords can deduct from their profits, to help minimise their Income Tax bill. But many buy-to-let landlords fail to claim some allowable expenses, which can leave them overpaying hundreds if not thousands of pounds each year in Income Tax.
This guide provides a basic overview of allowable expenses that you, as a landlord can claim, as well as ones that they may not be claiming.
Here’s what we’ll cover;
• Why buy-to-let landlords often fail to claim some allowable expenses.
• Allowable expenses that HMRC allows landlords to claim.
• Allowable expenses that buy-to-let landlords often fail to claim.
• How property maintenance, repairs and improvements are considered.
• Things that buy-to-let landlords cannot claim as an allowable expense.
Why do buy-to-let landlords fail to claim allowable expenses?
A big reason why some buy-to-let landlords’ allowable expense claim is lower than it could be is poor expense management. Obviously, this commonly includes losing receipts for purchases for which they could otherwise claim. Other buy-to-let landlords deem a cost so insignificant that they don’t think it worth the time or effort to record. But such costs can mount up over the year, so, where allowable, they should claim them all.
Lack of knowledge is the other key reason why some buy-to-let landlords fail to claim their full allowable expenses. They simply don’t know that certain expenses are allowable for tax purposes. In some instances, they might suspect that they can claim, but don’t, because they fear breaking the rules and getting into trouble with HMRC.
Some simple desk-based research can enable landlords to quickly find out which outgoings they can claim as an allowable expense. Some online sources of information are less accessible and reliable than others, which is why advice from a trusted tax professional can make a big difference.
What are “allowable expenses”?
For an expense to be allowable for tax purposes, as you know, it must be generated “wholly and exclusively” for the purpose of trade (in this case, renting out property). So, for example, a landlord cannot claim as an allowable expense a vacuum cleaner that they also use for cleaning their own home.
If they use something for business and personal reasons (eg their mobile phone), they can only claim allowable expenses for the proportion that results from renting out their property.
Some allowable expenses are more obvious than others. For example, a buy-to-let landlord may well know that they can claim for Council Tax, water rates, gas and electricity, if they pay these for the rented property (otherwise the tenant pays them, obviously).
They can also claim as an allowable expense ground rents and service charges, as well letting agent fees and management fees. Landlords’ insurance policies for buildings, contents and public liability can also be claimed as an allowable expense.
Need to know! The introduction of “Section 24” in 2017 removed a landlord’s previous right to deduct mortgage interest and other finance costs (eg mortgage arrangement fees) from their rental income before calculating their tax liability. Instead, landlords now get a tax credit of 20%.
Allowable expenses: what might landlords not be claiming for?
To maintain their property, a landlord may do some gardening, DIY or end-of-tenancy cleaning to save money, rather than paying someone else to do it. However, they can claim such services as an allowable expense, which could save them the trouble.
Landlords can also claim for some legal fees (eg for advice about pursuing a tenant for unpaid rent) and rather than doing their own bookkeeping or tax returns, they could hire an accountant and claim their fees as an allowable expense.
A landlord may be using their own landline or mobile phone for making calls that result from renting out their property. This proportion of their total bill can obviously be claimed as an allowable expense, and the same applies to vehicle mileage costs (eg if they need to travel to their rental property or make any other related journeys).
Some landlords may not realise that they can claim for advertising their property to attract new tenants, or that even relatively small costs, for example, stationery, can be claimed as an allowable expense. They may even be able to claim for costs incurred to dispose of old items of furniture or electrical appliances.
What about property maintenance, repairs and improvements?
Costs landlords pay out to maintain and repair a rental property to ensure that it retains its condition can be claimed as an allowable expense. Common examples include redecorating a property between tenants, fixing a broken window or mending a garden fence. If a landlord claims on their insurance to cover a repair, obviously, they cannot also claim it as an allowable expense. The same is true if their tenant pays for damage out of their deposit.
Replacing baths, washbasins and toilets is allowable, because they’re classed as building repairs, but only if the landlord replaces like for like (ie the quality isn’t superior).
Landlords cannot claim “capital improvements” as an allowable expense. Making capital improvements means upgrading, adapting or enhancing a property so that its value increases, which often involves making a structural change, for example, building an extension or converting a loft.
Need to know! Capital expenses aren’t allowable, so landlords can’t claim for them against their rental income, but they may be able to set them against Capital Gains Tax if they sell the property later on.
What can’t buy-to-let landlords claim for?
As explained on government website GOV.uk: “[Landlords] cannot claim the costs for replacing furnishings or equipment in a [rental] property. These are not allowable as costs of maintenance and repairs, but from 6 April 2016 they may qualify for Replacement Domestic Items relief.”
So, if the property is furnished or part-furnished, a landlord may be able to claim tax relief for replacing such things as sofas, beds, carpets, curtains, fridges, washing machines, sofas, crockery, cutlery, etc, as long as the quality is comparable – not superior.
Buy-to-let landlords cannot claim installing a security alarm system as an allowable expense unless they’re replacing one of a similar standard that was already there. If they’re in any doubt about what they as a buy-to-let landlord can and cannot claim as an allowable expense, you can add much value to the relationship by providing them with sound advice.
About GoSimpleTax
Income, Expenses and tax submission all in one. GoSimpleTax will provide you with tips that could save you money on allowances and expenses you might have missed.
Our software submits directly to HMRC and is the digital solution for Landlords to record income, expenses and file their self-assessment giving hints on savings along the way. Covering all self-assessment pages, not just property, GoSimpleTax does all the calculations for you saving you ££’s on accountancy fees.
Available on desktop or mobile application.
Article by Go Simple Tax
‘Property Alert’ is an award winning free property monitoring service aimed at anyone who feels a registered property could be at risk from fraud.
Once you have signed up to the service, you will receive email alerts when certain activity occurs on your monitored properties, allowing you to take action if necessary.
https://propertyalert.landregistry.gov.uk/
Article from the BBC; https://www.bbc.co.uk/news/uk-england-essex-59069662
A man has described his shock at returning to his house and finding it stripped of all furnishings after it was sold without his knowledge. Having been alerted by neighbours, the Reverend Mike Hall drove to Luton and found building work under way and a new owner who said he had bought the house.
A BBC investigation found Mr Hall’s identity had been stolen and used to sell the house and bank the proceeds. Police initially told him it was not fraud but are now investigating.
Mr Hall, who was away from the property and working in north Wales, said he received a call from his neighbours on 20 August, saying that someone was in the house and all the lights were on. The following morning, he drove there.
“I went to the front door, tried my key in the front door, it didn’t work and a man opened the front door to me,” he told BBC Radio 4’s You and Yours.
“I pushed him to one side and got in the property. I really didn’t know what he was doing there.
“The shock of seeing the house completely stripped of furniture; all furnishings, carpet, curtains – everything – was out of the property.”
The man said he was doing building work, to which Mr Hall replied: “I haven’t sold the house. This is still my property.”
Mr Hall phoned the police, but the builder left and returned with the new owner’s father, who said he had bought the terraced house in July, adding: “It is now my property. You are now trespassing. Get out.”
Mr Hall said: “We then tried to access the Land Registry documentation online to find out whose name appeared… and it is, in fact, as of 4 August, this man’s name.
“At that point the police said, ‘Well, there’s nothing further we can do here. This is a civil matter; you need to leave the house and contact your solicitors.'”
He then tried to contact police online, but received the same response.
“I was shocked – having seen the house in the state it was, I was in a bit of a state of shock anyway – but then to be told by the police they didn’t believe a criminal offence had been committed here was just unbelievable,” he said.
The BBC put Mr Hall in touch with Bedfordshire Police’s fraud squad, which has begun an investigation. A spokeswoman said there had been no arrests.
You and Yours obtained the driving licence used to impersonate Mr Hall, details of a bank account set up in his name to receive the proceeds of the sale, and phone recordings of the house being stolen.
Once the house was sold to the new owner for £131,000 by the person impersonating Mr Hall, they legally owned it.
The solicitors involved in the property transaction said there was an ongoing police investigation and that it was inappropriate to comment further.
The Land Registry paid out a total of £3.5m in compensation for fraud last year. It said: “We work with professional conveyancers, such as solicitors, and rely on them and the checks that they make to spot fraudulent attempts to impersonate property owners. “Despite our efforts, every year we do register a very small number of fraudulent transactions.”
Landlord Accreditation Training Course – ONLINE
Thursday 20th January 2022 – 9:00 – 4:30pm
Venue – Online
Price – £65 for members of SWLA, £75 for non – members for one day course.
Course covers ASTs, Deposits, Section 21s, Section 8s, HMOs, Gas and Electrical Safety, Inventories and much more.
The course will provide you with all the skills to start, manage and finish a tenancy.
Places still available. Contact the office on 01752 510913 or info@landlordssouthwest.co.uk to book your place, places only secured on receipt of payment.
Over 1030 landlords have already completed this course since September 2011.
Course can lead to Accreditation, if required.
We are proud to announce Landlord Accreditation South West (LASW) are founder members of the West of England Rental Standard.
Thursday 9th December 2021 – 9am – 12:30pm
Venue – Online
If you are accredited this will count towards your CPD hours, but the course is open to all.
Cost for SWLA members – £35
Cost for non-SWLA members – £40
Course Covers –
Places secured upon receipt of payment, book your place through the office 01752 510913.
Course will be instructed by Stephen Fowler from Training for Professionals.