Branches

Our Branch

21 Bridge Street, Newport, NP20 4AN
e: hello@redkeylets.co.uk
t: 0333 3447850
Newport Area Guide

Looking to buy or sell?

Please visit our sister branch,
Fortis Properties

Out of Hours Emergency

An emergency repair would include issues that need to be fixed as soon as possible. Examples would include: burst pipe/flood, fire, vandalism, broken locks, blocked drains, blocked toilet and no heating/hot water. Anything that would be a danger to your health and safety or likely to cause damage to the property.

In the event of an emergency during a holiday period – or outside office hours – please follow the guidance below.

Smell Gas?
In the event that you smell gas open all the windows, turn the gas off at the meter and call National Gas Emergency Service on 0800 111 999
For all other emergency issues, please call 01633 742371 and our friendly team will assist you.

Property Taxes: A Guide for Landlords in Newport

8 months ago
Property Taxes: A Guide for Landlords in Newport

Are you Finding Property Taxes Complicated?
If you’re a new landlord in Newport, you may find property taxes complicated and overwhelming. At Red Key, we are ready with some expert advice to help you better understand your obligations.

Adding Income From Property To Other Income
There’s a common misconception that any rental income you earn from your rental property in Newport will be taxed separately from your other income from shares or employment. However, that isn’t the case. While your property expenses and income are recorded on a separate area of the Self-Assessment form, your profit is added onto your other income to work out your total tax bill.

For that reason, it’s always sensible to calculate your likely property expenditure and income figures annually before investing in property. That will enable you to check whether your profit will likely take you into the next income tax bracket.

Another thing to remember is that additional income you receive from the property may mean you can no longer receive benefits such as tax credits or child benefits.

Recording Your Expenses
When completing a tax return, you should remember that some allowable costs can be deducted from the income you receive from your rental profit to reach your taxable profit amount. However, renting out your property and the money you spend on it are split between two categories.
You can offset “Revenue Expenditure” against the income you receive from your rental property. These expenses must have been exclusively incurred to earn rental income, for example:

Maintenance services like gardening or cleaning
• Business administration costs
• Repairs and redecoration
• Insurance
• Fees for any professional services (e.g. an accountant or lettings agent).

“Capital Expenditure”, on the other hand, is subtracted from your capital gains when you decide to dispose of your property. Those are things which increase the property’s value, for example:

• Adding an extension.
• Upgrading the kitchen.
• Carrying out major renovations.

Of course, some works include both expenditures, making recording expenses more complicated. Therefore, it’s wise to use an accountant’s services.

Higher Capital Gains Tax
Although tax is levied at 10% (at basic rate) or 20% (at higher rate) on your chargeable gains on your other financial assets, tax on gains from residential property is levied at 18% or 28%, depending on your tax band. You need to factor this in when planning the exit strategy for your property investment.

Capital gains tax is levied on the difference between your property’s original purchase and sale prices, with allowable deductions and personal allowances subtracted. It isn’t charged on how much equity you have remaining. Therefore, if you decide to remortgage the property at some point to release capital, you should always ensure you have sufficient equity remaining to cover your CGT bill should you suddenly need to sell.

Handling the financial side of your rental property can be a challenge, but you can rely on our expert team at Red Key to simplify the day-to-day management of your property. As experts in the Newport rental market, we make it easy for local landlords to maximise their investment.

Call us today on 03333447850 to learn more.

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