Landlord Contribution Accounting Treatment 

Landlord contributions are monetary contributions the landlord gives to the tenant, often to make them want to sign a lease and take out the space they’re renting. 

There are two main types of landlord contributions, landlord works and tenant works. If you’re a landlord, it’s important to understand which form your contributions make as incorrect disclosure can result in large tax penalties.  

Sounds confusing? Don’t worry! Here at Tax Kings, we want to cut the jargon and help you understand the best way to handle your landlord contributions. Read on to find out more.

Landlord Contributions And Reverse Premiums

Landlord Contribution Accounting

Typically, a landlord will offer one of three incentives to convince a tenant to take the property: A rent-free period, cash, or contributions towards the tenant’s works. 

Cash or contributions are known as ‘reverse premiums’; however, a rent-free period can’t fall under this category as no physical money changes hands.

It can become even more confusing when a tenant agrees to move into a property that is not yet finished. In this case, the landlord may employ the tenant as a subcontractor and contribute to their desired work alongside the landlord’s work to finish the property.

The simple matter is landlord contributions can get confusing. They can be a great way to work with a tenant to get them comfortably into a property, but they also raise a lot of tax queries. 

Working with a dedicated team of accountants can be the best way to avoid fines or penalties. You can trust the team at Tax Kings to take the pressure off you so you can focus on your day-to-day responsibilities.

 Our Dedicated Services

Here at Tax Kings, we offer a range of dedicated services to help landlords stay in control of their taxes and accounting. 

We use various HMRC accredited software to help you easily upload documents such as receipts, invoices and agreements. This makes accounting quick and efficient and will aid us in identifying the type of tax you will need to pay on various categories of contributions. Some of the services we offer include:

Tax Awareness

Our team wants to help you understand how we handle your taxes; we don’t want you to feel like you don’t know where your money is going – so we’ll explain everything to you in a way that is easy to understand. We can advise you on all the different taxes you’ll have to pay as a landlord and why you’ll have to pay certain taxes for certain contributions.

Landlord Compliance With HMRC

HMRC will ask you for various proof and receipts throughout your time as a landlord, and landlord contributions only intensify this. We can help you stay in line with HMRC by organising your proof to ensure you don’t receive any unwarranted fines.

You can read about more of our services by clicking here. 

Read More About

Accounting for Buy to Let Properties

Landlord

Accountants

Traditional Accounting Vs Cash Basis for Landlord

Why Choose TaxKings?

We price everything on a case-by-case basis and will give you a clear price breakdown after your initial consultation. You will only ever be paying for services that you need, nothing more, nothing less. 

We are devoted to giving you transparent services to help you make the most of your property investments. No matter how big or small your property portfolio is, we can help you to manage your landlord contributions effectively. 

Contact us today to find out more. You can find our contact details by clicking here. And you can meet our expert team by clicking here!

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