24) The risks that don’t show up on a spreadsheet

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Property118

24) The risks that don’t show up on a spreadsheet

Most landlords understand the numbers in their portfolio very well. They track values, borrowing, LTV, rental income and costs. Over time, those figures become familiar and reassuring. The portfolio can be measured, reviewed and compared year after year. From a financial perspective, very little is hidden, but not all risks are visible in those numbers.

What spreadsheets are good at showing

A well-maintained property schedule gives a clear picture of performance. It shows how the portfolio is growing, how it is financed and how it is performing on a day-to-day basis. It allows landlords to make informed decisions and to monitor progress over time. That visibility is one of the strengths of property as an investment, because it creates a sense of control.

What spreadsheets don’t tend to show

There are other aspects of a portfolio that are harder to quantify.

• How decisions are made.
• How responsibilities are shared.
• How easily the business could adapt if circumstances changed.

These are not reflected in property values or rental figures, yet they can influence how the portfolio performs over time.

The role of familiarity

Long-established portfolios often feel straightforward to manage. The properties are known, the processes are familiar, the way decisions are made has developed naturally over many years. That familiarity can be helpful, but it can also mean that certain aspects of the portfolio are rarely questioned, not because they are problematic, but because they have always been that way.

When the unseen becomes relevant

Most of the time, these less visible factors sit quietly in the background. The portfolio performs as expected and there is no reason to examine them closely. They tend to become more relevant when something changes: a refinancing decision, a change in personal circumstances, or a need to adjust income or involvement. At that point, what was previously unseen can become more noticeable.

The difference between strength and resilience

A portfolio can appear strong in financial terms while still being relatively untested in other ways.

Strength is often measured through assets and income.

Resilience is reflected in how the portfolio responds to change.

The two are related, but not identical.

A question worth considering

This is not about identifying problems; it’s about understanding the portfolio more fully: If something needed to change, how easily could your portfolio adapt?

For many landlords, this is not a question that has ever needed to be answered directly, it simply has not arisen.

An invitation for established landlords

If you have built a substantial portfolio and have only ever viewed it through the lens of financial performance, it may be worth taking a broader perspective.

You are welcome to email a copy of your latest property portfolio spreadsheet to Yvonne@Property118.com.

From there we can arrange a free introductory discussion to explore how your portfolio functions beyond the numbers and what that might mean for the years ahead.

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Government publishes information on new tenancy agreements

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Property118

Government publishes information on new tenancy agreements

The government has confirmed what information must be included in new tenancy agreements for the Renters’ Rights Act.

Landlords will need to give this information when creating a new tenancy on or after 1 May 2026.

It’s important for landlords to know that you will not need to provide this information to an existing tenant if the tenancy was signed before 1 May 2026.

Instead, landlords will need to give tenants a copy of the Renters’ Rights Act information sheet, or they could face a £7,000 fine.

Permission from letting agent to include contact details

If landlords are using a new tenancy agreement after 1 May 2026, they must include certain information such as:

• Your name (or the name of the landlord, if you are a letting agent or property manager acting on a landlord’s behalf) and the name of any joint landlords you let the property with.
• A postal address in England or Wales where the tenant can send legal notices to you, for example a notice to end the tenancy. This does not need to be your home address, but it must be an address where you can receive post. This could include a business address.

The government explain that landlords do not have to provide an email address or phone number, but they can choose to do so if they would like the tenant to be able to contact them.

The government say this could be helpful if you would like tenants to report repairs by phone or email.

Landlords can also choose to include the contact details of a property manager or letting agent, if they have one, but they are not required to do so.

However, the government point out that landlords must ensure they have permission from the letting agent to include their contact details.

Name and address

Other information that must be included in tenancy agreements include:

• Tenant(s) name – Landlords must include the names of all tenants, including joint tenants.
• Property address – Landlords must include the address of the property where the tenant will live.
• Tenancy start date – Landlords must include the date the tenant is first entitled to possession of the property. This means the first day when they are allowed to move into the property.
• Rent amount and when it is due – must include the amount of rent and when payment is due.
• Rent increases – Landlords must include a statement that if you make a new proposal to increase the rent, you will serve a notice on your tenant in accordance with Section 13 of the Housing Act 1988.

Explain which bills are covered

If the rent amount includes bills, then landlords must explain which bills are covered.

The government explains landlords do not need to say how much of the rent covers the cost of bills, but landlords can choose to include this if they wish.

Landlords may decide to ask tenants to make separate payments to them or someone else connected to them for the purpose of paying bills. If they do this, landlords must explain:

• What bills any separate payment will cover
• How much is due for each bill — or an explanation of how and when the tenant will be told this information
• When each bill payment is due — or an explanation of how and when the tenant will be told this information

Landlords only need to give tenants this information for certain bills. These are:

• Council tax
• Utilities, including electricity, gas or other fuel, water, and sewage
• A TV licence
• Communications services, including telephone, internet, cable TV and satellite TV
• Energy efficiency improvements under a green deal plan

Landlords only need to give this information for bills that are covered by the rent or which tenants must pay to them separately. Landlords do not need to explain which bills the tenant is responsible for arranging or paying directly to the supplier.

Important exception

Landlords must include the amount of the tenancy deposit, if they have taken one or plan to take one from their tenant.

The government explain: “Rules on tenancy deposits mean landlords must give specific information to tenants within 30 days of receiving the money. For example, this includes which government-approved scheme the deposit is or will be protected in.

“This information does not have to be provided at the same time as the other tenancy information listed, but it can be if landlords wish to do so.”

Landlords must also include the minimum amount of notice a tenant must give when serving notice to end the tenancy, as well as information about landlords ending a tenancy, such as through an order for possession.

However, the government have clarified an important exception: “The only circumstance where a landlord would not need to obtain an order for possession is where the Secretary of State has given written notice that the occupier is disqualified from occupying premises under a residential tenancy agreement because of their immigration status.

“In this circumstance, the landlord should instead serve the occupier with a notice to end the tenancy under the relevant immigration legislation.”

Right to request a pet

Under the Renters’ Rights Act, tenants will be able to request a pet, which landlords cannot unreasonably refuse. The government say a statement confirming this must be included in new tenancy agreements.

Other required information includes a statement that the landlord must ensure the property is fit for human habitation and details of the landlord’s obligations under Section 11 of the Landlord and Tenant Act 1985

The government also says that if there is only a verbal tenancy agreement (even if it began before 1 May 2026), landlords will still need to provide this information.

A full list of everything that needs to be included can be viewed by clicking here.

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Why Property118 is NOT currently recommending s162 incorporation to landlords with mortgages

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Property118

Why Property118 is NOT currently recommending s162 incorporation to landlords with mortgages

In February 2026, Property118 took HMRC to the First Tier Tribunal (Tax).

The hearing went on for 10 days.

We took this action because, since late 2023, HMRC has argued that the use of an indemnity for existing mortgage liabilities to be taken over by a company is a discloseable tax avoidance scheme. This is despite their own published guidance and concessions stating that this is what normally happens.

The above is NOT new; the HMRC guidance has retained this form for over 50-years!

HMRC has also recently taken the currently unpublished view (discovered via an FOI request) that if a company takes on new mortgage liabilities and uses those funds to redeem existing mortgage liabilities, such funds could be treated as taxable consideration under CGT rules.

The above is more plausible, in our opinion, and also according to established and highly redarded industry textbook guidance published by Lexis Nexis, which says as follows …

Established practice?

There could be a very strong established practice argument against this too. This is on the basis that HMRC has been unable to produce any evidence of having previously declined relief based their own consession (ESC/D32), even where the company took on new borrowing to repay liabilities which existed prior to incorporation.

Nevertheless, landlords who are considering any form of s162 incorporation, especially if they have mortgages or any other form of liabilities secured against their rental properties, should, in our opinion, defer their decisions to incorporate using s162 relief until absolute clarity is obtained in law. The mentally stressful and emotionally draining aspects of appealing an HMRC ruling cannot be underestimated, never mind the costs, which can easily run into six figures to pay for the necessary legal support.

Also consider that it took us nearly two years to get HMRC in front of the First-tier Tribunal. That is despite Property118 having always recommended what we regarded as the safer option, which was to follow HMRC’s own published guidance and to heed the risk warnings in Simon’s Taxes.

The above is intended to serve as a warning not only to landlords, but also to accountants, solicitors, barristers, mortgage brokers, lenders and financial advisers.

Tribunal outcome

We expect the First-tier tribunal to make a ruling later this year, but the losing side could then appeal to the Upper Tribunal and beyond, resulting in the wait for much need clarity potentially being pushed back even further. Meanwhile, these matters continue to frustrate landlords who would like to incorporate their businesses for the reasons explained in HMRC’s GAAR Guidance Part D paragraph 2.2, as follows …

A conversation worth having?

If you are weighing up your own strategy, whether that’s to sell, expand, or restructure to improve profitibility, it is worth having a discussion with a Property118 consultant to take a closer look at how your portfolio is structured as a whole now, and to forecast the outcomes based on multiple scenario’s.

These conversations are typically most useful for landlords with established portfolios and relatively modest borrowing who are beginning to reflect on how their assets could work more effectively in the years ahead.

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Tenants urged to check homes are licensed

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Property118

Tenants urged to check homes are licensed

More than half of the estimated 9,000 PRS homes in Blackpool’s latest selective licensing area have now been registered, with landlords who haven’t done so facing the prospect of fines or prosecution.

The scheme, covering eight wards, has been in place for almost a year.

It requires a £772 licence and, so far, 30% of licensed properties meet the higher Blackpool Standard for property management which comes with a discount.

Now, the council is urging tenants to ask whether their home is licensed, and whether it meets the higher management standard.

The Blackpool Standard

The council’s cabinet member for community safety, Cllr Paula Burdess, said: “People deserve better housing. There are clear links between poor quality private rented accommodation and deprivation.

“While we know that a great many landlords in our town provide a decent standard of housing for residents, as evidenced in the hundreds of homes which meet our high Blackpool Standard.

“But there are still many people living in poor housing.”

She added: “Tenants can ask their landlords if their home has been licensed, and if it meets the higher Blackpool Standard.

“By working together, we can improve homes, neighbourhoods and outcomes for all.”

EPC rating discount

Elsewhere, half of landlords secured a fee reduction by having an EPC rating of C or above.

In the licensing areas, landlords must meet conditions covering property standards, tenancy management, fire safety and action on anti-social behaviour.

Discounted fees are also available for homes meeting the Blackpool Standard or achieving an EPC rating of C or higher.

The Blackpool Standard requires landlords to provide documentation such as repair procedures and anti-social behaviour policies.

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