Hi Simon, could you please advise how the £3,000 tax paid by James was calculated in the example given at 5:06? I assumed it would be 40% of £12,000 giving £4,800. Thanks.
A bit of a doh 😖 moment for me as a poor video editor. I will amend as you quite rightly say to £4,800. Serves me right for not using excel for the calculations. Thank you 🙏 ever so much for the error spotting, which I will correct in the next 30 minutes. Apologies
Inheritance Tax - what are the tax considerations of giving greater capital to children over the years for a Partnership vs a Limited Company. Is one better than the other for an Investment Company?
To be honest this is too much of a difficult question to answer on a simple TH-cam channel. Please do get some tax advise on this subject to prevent a costly mistake
A question for you Simon. For a property business once you created the partnership business and you put in 20 hours a week. Do you have to be paid on the books or can you roll on that work and effort to allow the company to grow? Do you have to document it?
I have2 property’s in my name and now buying more through a ltd company.Should I just move to a partnership with my wife? Or keep Ltd company and start a partnership
Great question Stuart. If you manage the properties then absolutely. Else you can use a deed of trust (search for that video) to change the income split. Either way you may not need a limited company.
In regards to partnerships and incorporation I’ve decided not to make too much of a comment on a form such as this. Paragraph these are complex matters and have grave tax consequences if things are done incorrectly. I would be putting the insurance of Optimise Accountants at risk if I was to give you advice without doing a good enough job of researching your particular tax situation. I would ask that you invest good money and good time into speaking with those that Optimise Accountants by booking a tax call. Either that or speak to a local accountant that can help you with the creation of the partnership and limited company with the right people in mind
Great content again as per usual. I have been giving some serious thought to starting an LLP with my wife, I already have a Ltd with my sister which owns a couple of properties, but due to my wife being a foreign national there was complications in changing the Ltd company structure with the mortgage companies! So, starting another entity to buy another one is the way forward (my wife has now been in UK sufficient time to enable us to get a mortgage together). Like your example she too earns no money - the concern is that I do wish to start another legitimate partnership and there is advantages of doing so in an LLP as opposed to a Ltd. My concern is that as with the Ltd company we will outsource the SA running to an agent - you stated that this is not permitted by HMRC, despite the fact that my wife does do other duties such as book keeping, looking for potential properties, liaising with agent and other parties. Would I be correct in thinking that this is a no-no! We invest away from our local area so managing is not an option, nor is it something we wish to get more involved in as I approach retirement. Is there another route I could go down which would be tax efficient?
You do make some valid points, which are very relevant. HMRC will look at GAAR very carefully on a case by case basis. I would get some tax advice for you to be comfortable and confident with your tax plans. There are a lot of tax structures that will work for you and your family members. Cat needs to be taken to ensure that you choose the right one
Hi, Thank you for the very factual and informative video. There are a few areas I am not sure about: Can the partnership be set up between a long term living together partners? Does the mortgage provider need to be notified of the partnership or does it have to be registered with Land Registry? What happens if the person who owns the property dies? Or the other? Or both?
Great set of questions. I would suggest a meeting with your accountant / tax specialist to get these and many other questions o am sure you have about your specific situation answered.
Hi there Simon, great information on your YT account. I have a question: Does 'Sally' (or everybody in the partnership) have to be on the mortgage and title deed To be able to split the profits?
There is no legal requirement for partners to be on the mortgage title deed. However, it would always be beneficial to speak to the banks to ensure that the partnership structure is not going to break any terms and conditions of the mortgage itself.
@@UK-Property-Tax-Accountants interesting, would this also include adding a partner who was not part of the original purchase. or would that mean writing up a new deed of trust?
Hi Simon, if all your properties are in joint names with husband and wife and profits/losses are declared separately on SA100 tax returns, would we still need to form a partnership for 3 years before incorporation into a limited company to avoid paying CGT?
Sadly I am unable to answer that question. In fact it would be wrong of anyone to answer that question without thoroughly understanding your tax position now and in the next 2 to 5 years. You really need to diesel with your accountant to go through the concepts I have shared to see if they are appropriate for your specific circumstances and needs.
Simon Misiewicz Your Finance & Tax Director thanks for quick reply I was thinking to book 1 hour session with u to go over it in more detail. Do u think 1 hour tax session with u may help
One hour is plenty of time to create a five year plus tax plan. You will be able to upload your questions in advance and uploads any documents Book here using the code TH-cam25 to get 25% discount app.acuityscheduling.com/schedule.php?owner=19038952
Brothers and sister can be partners in a property business but you do need to get tax advice before implementing this structure. There could be many stopped eating and tax, income tax issues with its implementation
Hi, do you need to add your partner to the mortgage/land registry or is a deed of trust good enough and will this affect future incorporation if choose to do so?
You do need to speak with your mortgage broker about someone receiving money from the property The deed of trust by sharing the income will improve the ability to incorporate
Hi, my wife and I own BTL property as joint tenants the mortgage is in joint names. If we place the property into the partnership and then take a 70-30% share of profit, will this trigger an SDLT charge?
2020/21 update - Incorporation tax relief of moving buy to let properties to a limited company: th-cam.com/video/9N0nmAPKEfo/w-d-xo.html
Hi Simon .. I think it was you in Loughborough on Property Tax essential at The Link Hotel ..
Indeed it was 👍
Hi Simon, could you please advise how the £3,000 tax paid by James was calculated in the example given at 5:06? I assumed it would be 40% of £12,000 giving £4,800. Thanks.
A bit of a doh 😖 moment for me as a poor video editor. I will amend as you quite rightly say to £4,800.
Serves me right for not using excel for the calculations.
Thank you 🙏 ever so much for the error spotting, which I will correct in the next 30 minutes.
Apologies
Inheritance Tax - what are the tax considerations of giving greater capital to children over the years for a Partnership vs a Limited Company. Is one better than the other for an Investment Company?
To be honest this is too much of a difficult question to answer on a simple TH-cam channel. Please do get some tax advise on this subject to prevent a costly mistake
Hi Simon, great clear and helpful vids thanks. Can we set up a call to run through my situation? Thanks, Gordon
Hi Gordon, yes of course please choose from the three options listed here optimiseaccountantsltd.as.me/optimiseaccountantstaxconsultation
Thanks Simon
@gordonadam7051 you are welcome 🙏
Do you provide the service of setting up this type of partnership?
We certainly provide services to set up limited companies but not partnerships
@@UK-Property-Tax-Accountants thanks for your response. Is there someone you could recommend?
A question for you Simon. For a property business once you created the partnership business and you put in 20 hours a week. Do you have to be paid on the books or can you roll on that work and effort to allow the company to grow? Do you have to document it?
Great question. Sadly it is not something that I can answer here. That said there is no requirement to work religiously to the 20 hours
Would the SDLT charge still be applicable if the change in profit split is between husband and wife?
There would be a SDLT charge if you change the mortgage or the spouse gives you money in return for the property
Looking forward to this one Simon 🤞
Thank you Jonny, hope it lives up to your expectation
I have2 property’s in my name and now buying more through a ltd company.Should I just move to a partnership with my wife? Or keep Ltd company and start a partnership
Great question Stuart. If you manage the properties then absolutely. Else you can use a deed of trust (search for that video) to change the income split. Either way you may not need a limited company.
What if you are both higher rate tax earners?
Sadly, a partnership will not benefit you as a couple that are high rate taxpayers
@@UK-Property-Tax-Accountants thata what i thought! Thank you, back to the drawing board
You are welcome. I’m just sorry it is not the answer you are looking for
Can you have partnership between your wife and mum? A three person partnership? Incorporated and put everything into one existing business account?
In regards to partnerships and incorporation I’ve decided not to make too much of a comment on a form such as this. Paragraph these are complex matters and have grave tax consequences if things are done incorrectly. I would be putting the insurance of Optimise Accountants at risk if I was to give you advice without doing a good enough job of researching your particular tax situation. I would ask that you invest good money and good time into speaking with those that Optimise Accountants by booking a tax call. Either that or speak to a local accountant that can help you with the creation of the partnership and limited company with the right people in mind
Is it worth getting into BTL even if you're a higher rate tax payer?
Yes as BTLs are good investments nut get tax advice before you invest.
Great content again as per usual. I have been giving some serious thought to starting an LLP with my wife, I already have a Ltd with my sister which owns a couple of properties, but due to my wife being a foreign national there was complications in changing the Ltd company structure with the mortgage companies! So, starting another entity to buy another one is the way forward (my wife has now been in UK sufficient time to enable us to get a mortgage together). Like your example she too earns no money - the concern is that I do wish to start another legitimate partnership and there is advantages of doing so in an LLP as opposed to a Ltd. My concern is that as with the Ltd company we will outsource the SA running to an agent - you stated that this is not permitted by HMRC, despite the fact that my wife does do other duties such as book keeping, looking for potential properties, liaising with agent and other parties. Would I be correct in thinking that this is a no-no! We invest away from our local area so managing is not an option, nor is it something we wish to get more involved in as I approach retirement. Is there another route I could go down which would be tax efficient?
You do make some valid points, which are very relevant. HMRC will look at GAAR very carefully on a case by case basis.
I would get some tax advice for you to be comfortable and confident with your tax plans.
There are a lot of tax structures that will work for you and your family members. Cat needs to be taken to ensure that you choose the right one
Hello. Do you offer a discount code for a personal tax consultation please
Yes indeed TH-cam25 yo get25% discount
Hi,
Thank you for the very factual and informative video. There are a few areas I am not sure about:
Can the partnership be set up between a long term living together partners?
Does the mortgage provider need to be notified of the partnership or does it have to be registered with Land Registry?
What happens if the person who owns the property dies? Or the other? Or both?
Great set of questions. I would suggest a meeting with your accountant / tax specialist to get these and many other questions o am sure you have about your specific situation answered.
Hi, Great videos! If I am a higher rate tax payer with a buy to let property can I set up a partnership with my father who is due to retire soon?
Absolutely you can. Take good advice to help you with the set up
Great information
Thank you most kind
Hi there Simon, great information on your YT account. I have a question: Does 'Sally' (or everybody in the partnership) have to be on the mortgage and title deed To be able to split the profits?
There is no legal requirement for partners to be on the mortgage title deed. However, it would always be beneficial to speak to the banks to ensure that the partnership structure is not going to break any terms and conditions of the mortgage itself.
@@UK-Property-Tax-Accountants interesting, would this also include adding a partner who was not part of the original purchase. or would that mean writing up a new deed of trust?
How much will it cost for the filling in of company tax return each year?
We charge £99.95 per month including VAT, which includes tax advice when required by phone.
Hi Simon, if all your properties are in joint names with husband and wife and profits/losses are declared separately on SA100 tax returns, would we still need to form a partnership for 3 years before incorporation into a limited company to avoid paying CGT?
You may not need to form a partnership as there may be ways around it for you to incorporate. A tricky subject but worth speaking with your accountant
both me and my wife are high rate tax payer and jointly hold 3 BTL personally; can I use this strategy? for future buys- should I buy in Ltd company?
Sadly I am unable to answer that question. In fact it would be wrong of anyone to answer that question without thoroughly understanding your tax position now and in the next 2 to 5 years.
You really need to diesel with your accountant to go through the concepts I have shared to see if they are appropriate for your specific circumstances and needs.
Simon Misiewicz Your Finance & Tax Director thanks for quick reply
I was thinking to book 1 hour session with u to go over it in more detail. Do u think 1 hour tax session with u may help
One hour is plenty of time to create a five year plus tax plan.
You will be able to upload your questions in advance and uploads any documents
Book here using the code TH-cam25 to get 25% discount
app.acuityscheduling.com/schedule.php?owner=19038952
In this example you said husband-and-wife can also be a partnership between brother and sister
Brothers and sister can be partners in a property business but you do need to get tax advice before implementing this structure. There could be many stopped eating and tax, income tax issues with its implementation
Hi, do you need to add your partner to the mortgage/land registry or is a deed of trust good enough and will this affect future incorporation if choose to do so?
You do need to speak with your mortgage broker about someone receiving money from the property
The deed of trust by sharing the income will improve the ability to incorporate
Hi, my wife and I own BTL property as joint tenants the mortgage is in joint names. If we place the property into the partnership and then take a 70-30% share of profit, will this trigger an SDLT charge?
As long as you are not changing the debt situation then no SDLT would apply
@@UK-Property-Tax-Accountants thanks for the reply. did you mean "no SDLT"
just amended my comment to no SDLT as opposed to knows SDLT, predictive text
how comes the James will be subject to capital gain tax as james seeling 50% ownership. I belibe I am right.
CGT is chargeable if capital is transferred between two parties that are not husband and wife see 14:30