Making Tax Doable for Landlords

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With Making Tax Digital for Income Tax, getting closer and closer to mandation, it is getting even more important for landlords to get an MTD appropriate solution in place.

Rental property owners are set to be some of the most affected by the changes put in place for making tax digital – many have a system, spreadsheet or calculation, that they have used for years to calculate their Self Assessment Tax Return for the year. Even more still keep entirely paper records – but with just one annual return per year, this was an adequate system.

But MTD is just over 18 months away. And with that comes the need for digital record keeping, and quarterly tax submission.

APARI has always listened to our landlord users, and the feedback provided from LandlordZone readers has been absolutely crucial to helping us build the best solution for Landlords being majorly affected by MTD – here’s how;

Bank Connections

Uploading individual transactions into a software can be tedious and often time consuming! Many landlords keep a separate bank account for their property income, and so one of our biggest introductions in the last year has been our banking connection.

Powered by Open Banking Technology, you can connect your bank account directly to APARI, and the transactions in that account will automatically feed through – just leaving you to log in and allocate those transactions to the appropriate category. 

If you don’t have a separate bank account, then that’s fine too – you can just allocate anything irrelevant to private expenditure, but we would recommend at least considering having a seperate account, even if just for MTD purposes.

Receiving the net amount from your Agent

Are you one of the many landlords who uses a letting agent? If so then a major aspect of MTD is the need to show not just the amount received from your letting agent in the month, but the separate transactions of the amount of rental income and the letting agents fee, which make up the net amount that hits your bank account.

This has frequently been mentioned as a concern by landlord’s – so APARI has introduced the Split Transaction feature on all transactions uploaded into the software.

This handy feature allows users to segment a transaction in the bank feed, into the individual parts that make it up e.g. Your property is managed by an agency and you receive a net income of £1,100. However, the actual rental income is £1500, the agency fee is £150 and a property repair is completed on your behalf for £250.

Any split transaction will need to recalculate the net of the transaction pulled through, so any non-business parts of the transaction will need to be allocated to non-business.

Jointly owned property

I know we only spoke about this last month – but we are SO proud of this feature, so will continue to shout about it for a while!

Taxpayers who own a property with another person (eg. spouses, business partners, etc) will soon need to show each transaction relating to their ownership of a property. That’s (at least) double the work!

But with the APARI joint property feature, we can automate this split – meaning one transaction upload, one allocation, gets automatically uploaded into your co-owners APARI account. Simple!

So in summary – yes MTD is going to be more work for landlords! But using a product like APARI can really help reduce this burden.

Don’t believe us? Try it out for a month, FREE!

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