Why? the end result is pretty much the same,I get cash back in first instance and I pay less tax in the last instance by writing off the full cost of mgt fee.There's a huge difference between having an expense refunded and claiming a tax deduction on it.
Why not just charge them the headline rent that you set and then you apportion some of that to your own costs (e.g. management fees, insurance, maintenance costs, tax etc.)? In setting the rent you factor in things such as your overheads, target yield etc. (Obviously RPZ, if applicable, could be a restricting factor here). If the success or failure of your intended investment hinges on charging the tenants the management fees (explicitly or in kind) then you might want to carefully analyse and stress test your business plan.Hi everyone, seeking for the advice as I can’t find the info anywhere. I am considering to buy an apartment as an investment. A lot of them now have a rental cap. It would still work out for me profit wise if I ask the tenants to pay the management fees. Is that a legal thing to do?
The difference between 100% and the taxpayer's marginal rate of tax.Why? the end result is pretty much the same,I get cash back in first instance and I pay less tax in the last instance by writing off the full cost of mgt fee.
What's the huge difference?
What has marginal rate of tax got to do with it? I'm writing 100% of the management fee off against tax.The difference between 100% and the taxpayer's marginal rate of tax.
You're 100% misunderstanding it.What has marginal rate of tax got to do with it? I'm writing 100% of the management fee off against tax.
LLs typically write it off against tax so not sure I see a benefit.
Let's develop the subject a bit further:- Who is liable for the television licence? Who pays for internet access?
No. Replacing a door is in almost all cases a cut and dried P&L expense.If the landlord pays for the door but does not deduct the cost as an expense as it is capital expenditure (which I suspect is the correct treatment)
Have you any reading for me on this. I replaced windows in 2022 and and I am advised that this is a capital item. The old windows were timber framed and draughty, the new windows are PVC.No. Replacing a door is in almost all cases a cut and dried P&L expense.
Knocking a big lump out of a wall to create a new doorway and installing a door in it would be capital expenditure, as it's adding something that was not there previously.
Not readily but it should be in any basic tax textbook.Have you any reading for me on this.
If there's an element of improvement there, it's arguable that it should be treated as capital. That's said if the old door was defective (which these things usually are if they're being replaced) I think it is easily arguable that it's merely a replacement and doesn't add anything to the value of the house. It's not as if a PVC door is any dearer or more sought after these days than a timber framed one is.I replaced windows in 2022 and and I am advised that this is a capital item. The old windows were timber framed and draughty, the new windows are PVC.
Who advised you by the way? (just curious generally, no need to identify any individual).Have you any reading for me on this. I replaced windows in 2022 and and I am advised that this is a capital item. The old windows were timber framed and draughty, the new windows are PVC.
I usually do my own returns, but as I had some other business with a local accountant and a big spend with a builder which included installing an extra bathroom, new pic windows to replace old timber ones, and painting the entire. I thought I would ask him to do my return. He is adamant that the windows are capital expenditure. I feel that is easy for him to say. I am not convinced he is trying too hard.Who advised you by the way? (just curious generally, no need to identify any individual).
You are writing 100% of the management fee off against income and then calculating the tax due on the net income.What has marginal rate of tax got to do with it? I'm writing 100% of the management fee off against tax.
Yes correct.You are writing 100% of the management fee off against income and then calculating the tax due on the net income.
How is 100% reimbursement of any outlay, and the same outlay net of tax, the same?Why? the end result is pretty much the same,I get cash back in first instance and I pay less tax in the last instance by writing off the full cost of mgt fee.
What's the huge difference?