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Save tax on your buy to lets – advice for married couples

Since April 2020 mortgage interest higher rate relief on Buy To Let property has been entirely phased out. This means that the majority of private Landlords in the UK now have much tax bills, making the Buy To Let dream far less attractive. But there are still ways to save tax on your buy to lets.

In last week’s blog we took a look the pros and cons of moving your Buy To Let properties into a Limited Company in exchange for shares.

To make that route worthy of consideration we would suggest that you really need to be a Landlord with a good number of actively managed properties (say 10+) valued at around or above £2m. You can find out more about that on our special pages for Buy To Let Landlords here.

The majority of Landlords however, some labelled as “accidental” do not fulfil this criteria and for them the potential costs involved in transferring their let proprties into a Limited Company will likely exceed the benefits.

But if you are married or in a civil partnership and one of you is a basic rate taxpayer (or even below the tax threshold altogether) and your small portfolio of Buy To Let properties is held in joint names there are other tax saving alternatives open to you.

It is possible, by structuring your affairs correctly, to share the allocation of net rents between yourself and your partner or spouse in unequal shares.

By doing this, more of the taxable income is shifted to the partner who pays the lowest rate of tax which can often result in a substantial saving on the overall combined tax bill of the family unit.

For More Information on Tax Saving Solutions Contact THP Today

At THP we have already done this successfully a good number of times and have now created a system together with a good number of template forms which we know will be accepted as valid by HMRC.

So whether you are in the process of buying a Buy To Let property now and you think this could apply to you or you simply want to put a more tax efficient solution in place before the start of the next tax year, please give us a call.

Our team of BTL property tax experts are just waiting to help and advise you on how to reduce the additional tax bills on your BTL lettings with the minimum of hassle and without it costing you a fortune.

Visit the special section of our website for Buy To Let Landlords here to find out more.

Avatar for Jon Pryse-Jones
About Jon Pryse-Jones

Since joining THP in 1978, Jon Pryse-Jones has been hands on with every area of the business. Now specialising in strategy, business planning, and marketing, Jon remains at the forefront of the growth and development at THP.

An ideas man, Jon enjoys getting the most out of all situations, “I act as a catalyst for creative people and encourage them to think outside the box,” he says, “and I’m not afraid of being confrontational. It often leads to a better result for THP and its clients.”

Jon’s appreciation for THP extends to his fellow team members and the board.  “They really know how to run a successful business,” he says.  He’s keen on IT and systems development as critical to success, and he continues to guide THP to be at the cutting edge and effective.

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