Saving tax on buy-to-let

I've been beavering away over the last week trying to get my dreaded self assessment tax return filed before the deadline of 31st January 2011.  I'm obviously keen to pay as little tax on my residential investments as possible. For the benefit of other landlords I've shared below some of my best tips for saving tax on your buy-to-let portfolio.

Saving property tax guides

As in previous years, I'm using HMRC online tax filing software which apart from a few glitches seems to works pretty well.  I've also being using Property Hawk's FREE online software to calculate using the accruals method the rental profits on my properties.

The tax year being assessed is the 09/10 which runs from 5th April 09 to 6th April 10.  For me it's one where the impact of low interest rates has seen many landlords including myself making unprecedented rental profits.  This is where landlords who have carried forward their rental losses in previous year benefit as it is possible to off set these against your rental profits reducing massively in some cases a landlords tax liability.

Where landlords use their on home as an office to manage their rental property remember it is quite acceptable to claim as an expense the costs of doing this.

In deciding whether an item qualifies as an expense then a landlord needs to apply the rule of "wholly and exclusively" required for the lettings business.  That said, between me and you.  If you do include an expense that does not exactly meet this rule.  The chances of the taxman run off his feet at this time of year picking it up?  Small but it is a risk.

Here are some other articles that should be helpful to keep your property tax to a minimum:

Landlords 5 ways to slash your tax

Saving tax by splitting the rent

Ten innovative ways to save tax

Every landlord should claim £156


Further expert tax advice