How much can I save?????

By using the latest Quantity Surveying techniques, as approved by HMRC, along with the Accounting knowledge required, we can typically identify Plant & Machinery assets within a tradional multi-let (shared bathroom / kitchen / lounge / hallways etc) equivilent to 20%-25% of the purchase price.

This gives you ‘tax dedutible allowances against any income stream.

*This is a conservative guide only.

A HMO property purchased for £200,000 could have qualifying allowances of £40,000.

The Allowances of £40,000 can be used as a tax deductible allowance against income.

Plant & Machinery Capital Allowances are effectively treated as an expense of the business. http://www.hmrc.gov.uk/manuals/camanual/CA29320.htm

If you have purchased property after 6th April 2008, this whole amount can be offset against taxable income using the AIA (Annual Investment Allowances) legislation. AIA legislation states that up to £50,000 of allowances may be used as a deductible business expense. Any balance over this amount, will be part of the ‘general pool’ of assets, and written down at 20%.

Individuals who have other sources of income, and incur PAYE deductions can claim AIA and/or Capital Allowances on the property using ICTA1988 s380. These allowances can be claimed against your overall tax position, and in many cases, wipe out any tax you have paid. A refund will need to be applied for in some circumstances.

However, pre 6th April 2008, HMRC will not allow you to use all of this allowance at once. There are rules which govern the rate of usage of the allowance.

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