BTL Landladies: how often do you file your tax return?

[LandladyMaybe]

I recently became a BTL landlady. I understand that I have to pay 20% of my profits, minus my expenses, in tax. How often can I/ do you do this? Can I do it quarterly?

Self assessment is annual. You need to register and then they’ll send you prompts and reminders.
www.gov.uk/self-assessment-tax-returns

I do mine myself but you can pay an accountant if you aren’t confident.

Once a year. But its not 20% of profits... its whatever your tax rate is on the income (minus expenses... so before mortgage for example!)

Once a year but it's more complex in terms of what you can expense and what you should pay. Use an accountant if you aren't confident you know. I use one as I don't!

This is a helpful link and after you might want an accountant to help of this is jot something you are familiar with.

Also note you are able to get some tax relief on mortgage payments but only the interest element (not the capital part) and only at basic rate

Not any more you can’t! Tax relief on mortgage interest ceased.

Can't I submit quarterly? I don't like holding onto money I can't spend!

It’s not completely ceased!

@LandladyMaybe

• you will find that you have to pay some of next years too in January as they will work on the basis it will be the same as this years, The ask for twice yearly and you pay July/January.

I used to get an accountant to do my return every year when I was an LL. It cost £200 but was worth every penny.

@Rutland2022 ok not strictly relief but a credit at 20% of the mortgage interest payments which is effectively relief (in certain circumstances) at 20%

I did however forget the link

www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

Just put money into a savings account for the tax! You get personal tax relief if you haven’t used it elsewhere. Register and fill in the forms by the required date and pay first amount of tax by 31 Jan. The tax is based on income for year 21/22. Then pay next amount in July. Get an accountant. It’s easier!!

You'll be able to do that from 2024 unless it's postponed.

Yes you can pay tax in advance on account

I pay six months ahead based on last years income. So in April 2022 I paid the expected amount for the first six months, then in July I pay the second six months. I think its something to do with making it more equal with employees, who pay up front all year old

I pay my tax monthly. I work out roughly what it is likely to be for the year and then pay a set amount monthly. When I do the return I then settle up anything owed, or more often I might get a few £’s back.
Mine doesn’t vary much usually year on year but this last tax year I had to do a load of maintenance so should have a far smaller bill and a rebate. But usually I manage to get what I have paid vs what is owed down to about £100 difference.

I did use to just put it in a savings account but with everything being so hard lately the temptation to spend it is too great. They pay interest on anything overpaid and paid back so it’s not much different and stops me worrying about it.

I pay 40% tax on mine sadly though so it’s a fair whack. But it wasn’t an investment, it’s my former home.