Insurance and tax aren’t the most exciting topics, but they are two of the most important to understand. These are some of the top questions we get asked by landlords.
Insurers consider a tenanted property to be higher risk than an owner-occupied home so it’s definitely working getting landlord insurance. It’s important to be aware that if you only have standard home insurance for a property that you rent out, any claim is likely to be rejected, which could leave you significantly out of pocket.
Landlord insurance products are designed to be flexible and cover a range of issues so you can customise them to your specific type of let and tenant profile.
Most landlord policies include as standard:
If not already included, it’s worth considering adding the following:
The cost will vary. It will depend on the size and location of your property, the type of tenancy, optional extras you may have added, and your insurance history.
As a rough guide, to insure a 3-bed detached modern property that is let to working tenants, you can expect to pay between £500 and £700 a year / £42 to £58 a month for a landlord policy that includes liability insurance and loss of rent cover. For a modern 3-bed terrace, it would be between £300 and £500 a year / £25 to £42 a month.
Tax is very personal to your own circumstances. It isn’t just based on your property earnings, it’s applied across all your income and assets.
If you’re buying a property at £200,000, that’s £1,500 standard Stamp Duty (£75,000 x 2%) plus £6,000 higher rate tax (£200,000 x 3%).
The best way to make sure you pay the right amount of tax is to consult a property tax specialist. By getting properly tailored advice, you’ll be able to judge what you’ll need to pay and when, so you can plan ahead.
For landlords paying income tax via self-assessment, the deadline for payments is 31st January each year.
For the tax year 6th April 2021 to 5th April 2022, the deadlines for filing your return are:
For more information on letting property, do get in touch with our experts. We're an introducer appointed representative of Bode Insurance Solutions who can provide you an instant landlord insurance quote.
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