Tax watch: buy-to-let landlords beware
As the 31st January deadline looms, buy-to-let landlords should be aware that the taxman has his beady eye on you. So make sure you're not claiming too much tax relief.
As the 31 January self-assessment deadline looms, buy-to-let landlords should be aware that the taxman has his beady eye on you, says David Budworth in The Sunday Times. So far the Revenue has concentrated on ensuring that buy-to-let investors pay the correct tax on rent and capital gains; now, having spotted that some are underpaying, they are turning their attention to landlords with capital-repayment mortgages.
With a repayment mortgage, part of your monthly mortgage payment goes towards paying interest, while the other slice is used to repay the capital. Buy-to-let landlords can claim tax relief to reduce the tax they pay on the rental income, but only on interest payments.
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