Are you a new landlord looking for ways to stay organised and keep everything in one place? Then keep on reading. In this blog, we’re letting you know how to track expenses as a landlord.
The importance of tracking landlord expenses
As a landlord, it’s vital that you keep track of all expenses to ensure that you have a clear view of how your property investments are performing. It also makes it much easier to file tax returns as all of the information you need is organised well.
In some cases, you may be asked to present evidence to support your tax claims. If you can’t provide this information then you may end up in a rather stressful situation.
What do I need to track?
You may find it difficult in the beginning to assess what you actually need to track, but over time, this should become easier. Additionally, many landlords will outsource this task to save time and for a little more peace of mind. After all, being a landlord can be busy! It’s common for landlords to work with an accountant for their tax return and tracking expenses.
You’ll need to track the following elements as a landlord.
- Your rental income
- Your rental property expenses
- Any supporting documentation such as receipts and invoices
Tips for tracking your expenses as a landlord
Know what you can claim for
This is crucial if you want to ensure accuracy within your account keeping. You cannot claim anything back on money spent on things that do not relate to your lettings. You may be able to claim expenses for the following.
- Contents insurance for furnished properties
- Letting agent fees
- Legal fees
- Service costs – ground rents
- Some aspects of property maintenance – repair costs/furniture costs
- Council tax
It’s worth noting that everyone’s situation is different and therefore you may not be able to claim for all of these things. You should complete your own in depth research to identify exactly what can be claimed.
Understand your finances
It’s a good idea to create a breakdown of your set property income and expenses for each month. This can help to make things more clear for you during this process. Some of these may include your mortgage and insurance.
Obtain and file paper receipts for all your expenses
In order to successfully claim for expenses, you need to be able to provide evidence. This evidence tends to come in the form of receipts or invoices for items relating to your letting affairs.
This may include paying for things like new furniture in the property or software that relates to the lettings process. It may be a good idea to have a simple spreadsheet for keeping track of allowable expenses.
Stay in the know regarding tax liability and allowable expenses
You probably already know that legislation changes quite often for both landlords and tenants. With this in mind, it’s important that you stay up to date with the latest legislation surrounding landlord expenses.
Seek support for expense tracking
Luckily, you don’t need to go it alone when it comes to your expenses. There is plenty of support available that can help take the pressure off you. You can work with a company or even use a property management software to track income.
Are you preparing to become a landlord and need some support? At Intus Lettings, we support landlords with all aspects of the letting process. Get in touch with us to see how we can help you promote your property and reach tenants.
