Updated KEY GUIDES now published – November 2019

Updated KEY GUIDES now published – November 2019



All the Guides have been reviewed for relevant developments and some stylistic improvements. The following Guides have specific changes as detailed. If a title is not listed, then no additional substantive changes have been made for this release. The disclaimer date on the guides has been updated to reflect the date of the review.

You can access the whole series of KEY GUIDES through the downloads in the Recent News section of our website here: –

The amended KEY Guides are: –

Investing tax efficiently

  • The three important changes for capital gains tax on residential property which take effect from 2020/21 are now included.

Making the most of fringe benefits

  • A new introduction now includes statistics on most popular benefits and how the company car, traditionally a popular benefit, has become less tax efficient.
  • The guide explains one way to improve efficiency is for employees to contribute up to £5,000 for a new company car which may allow them to afford a car with much lower emissions.
  • Additional information on other new fringe benefit options designed to improve wellbeing such as wearable tech, counselling and flexible working hours.

Pensions tax planning for higH earners

  • Additional material on tax charges issued for breaches of the lifetime allowances to doctors, NHS staff and other professionals.

Starting and selling a business

  • Revised introduction focuses on challenges regarding business costs and those of suppliers or potential suppliers or customers.
  • For freelancers the freedom of working when and where you desire must be balanced against the discipline required and lack of sickness and holiday benefits.
  • A new section explaining the low costs associated with operating online via a website also highlights the necessity of an online presence for all businesses so customers can find offline products and services.
  • The latest information on the expansion of the IR35 rules to the private sector including recent tribunal cases.
  • The current attractive rates of CGT are highlighted, which could change following an election, so those thinking of selling their business might be wise to do so sooner rather than later.

Strategies for a high tax environment

  • Information added on the shortening of tax payment timings for residential buy-to-let sales which will affect any sales made after 5 April 2020, when tax will be due within 30 days of completion.
  • The latest figures on accelerated payments collected by the government for those involved in tax avoidance schemes are published.
  • We mention the proposals by the Office of Tax Simplification to adjust tax allowance for inflation, although other benefits would be withdrawn.

Tax allowances for business investment

  • A new section highlights the pitfalls in claiming expenditure for building owners, whether on commercial or residential properties.

Taxation of property

  • Significant reworking and revision moving the focus to upcoming changes to CGT and finance costs.
  • Updated examples on finance cost restrictions and tax charge on company dividends.
  • Additional material on furnished holiday lettings.

Working through personal service companies

  • Further examination of the complicated IR35 rules includes the reform of its application to public sector engagements and the forthcoming expansion to the private sector.
  • Advice on the CEST tool, and how to remain independent of your client, and avoid being subject to IR35.

You and yours – estate planning

  • An additional section on the July 2019 Office of Tax Simplification.

If you have any queries or need further information on topics covered by our KEY GUIDES or any other matter, contact Paul Southward.

Paul Southward's News Roundup

Residential Landlords – Loan Interest Relief

Residential Landlords – Loan Interest Relief

12th July 2018

Residential Landlords

What is happening to my loan interest relief?

Residential landlords may notice a difference to their rental income tax calculations this year.

Back in 2015 new rules were introduced to restrict tax relief on loan interest and finance charges arising in respect of residential property lettings the rules are being phased in over a four year period and the first phase starts for the tax year just ended 2017/18.

What are the restrictions?

The aim is to restrict the tax relief given for loan interest and finance charges arising in connection with residential lettings to the basic rate of tax (currently 20%).

To lessen the overall impact and perhaps to allow residential landlords to rearrange their lettings finance models, the restrictions are being phased in over the next few years:-

  • For 2017/18 the restrictions apply to 25% of the costs;
  • For 2018/19 the restriction applies to 50%;
  • For 2019/20 the restriction applies to 75%, and
  • For 2020/21 all finance costs and loan interest relief will be restricted to the basic rate of tax.

Residential landlords who only pay tax at the basic rate should not be affected by the changes.

These changes bring another level of complexity and potential cost to residential landlords. By the year 2020/21 some landlords could see all rental income profits used up in tax charges and effectively they will be funding the Exchequer for owning rental property.

Paul Southward tax director at Keens shay Keens limited says “Residential Landlords need to understand how the new rules will impact on the lettings business models.  This will help them understand what changes may be necessary to address this issue”.  It is for this reason that Paul has prepared a detailed illustration of how the new rules will be applied from the last tax year ended on 5th April 2018 and going forward to 2020/21.

Paul has made his illustration available as handy download that can be accessed here:

Residential Landlords – loan interest relief

If you are a residential landlord and want to know how you can maximize your tax savings contact Paul Southward.

Paul Southward


Landlords and HMRC’s let property campaign

If you are a landlord and you are confident that your tax affairs are up to date and that all your rental income has been correctly declared, then all is well.

If you are a landlord and you think that you may not have made the correct disclosures to the taxman; then you may want to take action before the taxman comes knocking on your door!

Advances in technology coupled with the increase of powers available to the taxman have enabled him to access a whole heap of information regarding property transactions and property rentals across the UK.  It may be a slow process but the taxman is now linking the information held, to property owners, and is making enquiries.

In the past, HMRC have successfully used campaigns to encourage voluntary disclosures from individuals for whom the taxman may have information about undisclosed tax liabilities.

One of the more recent disclosure campaigns is aimed at Landlords.  The scheme covers more or less anyone who has received income from letting out a property, properties and even rooms in their main house (subject to certain exemptions).

So why volunteer a disclosure?  Quite simply, to benefit from a more lenient settlement with HMRC than would be available if HMRC discover that you owe taxes and have not made a disclosure.

The taxman can charge penalties of up to 100% (200% for certain offshore liabilities) of the tax due for failing to notify a tax liability or for making an inaccurate return.

Under the let property campaign the taxman may agree to a much lower penalty, of say, 20% or less, and in some cases £nil.

At the moment there is no set time limit for someone to make a disclosure under the let property campaign, however, a delay in doing so could result in higher penalties.

You can of course make a disclosure directly to the taxman; however, we believe that we can offer you more.  If you engage us to assist with your disclosure we will make sure that you claim all the appropriate deductions that you are entitled to, and ensure that you only pay the correct amount of tax; this will also help minimise any penalties charged.  We explain and guide you through the whole process and deal with the taxman on your behalf to ensure that you get the best possible deal, and give you peace of mind that your tax affairs are brought fully up to date.

If you would like to discuss your particular circumstances in confidence, contact Paul Southward.