Along with everything else you need to be doing, like keeping on top of property maintenance and vetting new tenants. As a landlord, it is crucial that you stay on top of your finances. Otherwise, you could end up in a bad financial state.
We understand that keeping on top of your finances as a landlord can be utterly exhausting, especially if you have multiple properties to take care of. Even so, your finances are something you can’t afford to ignore.
To help you get your finances in order and keep on top of them, we have put together some handy tips, below:
- Get an accountant
Unless you have an excellent mathematical mind or accounting experience, it is a good idea to get an accountant. A good accountant will be able to help you get your financial records in order and will also be able to deal with your tax for you, saving you time and money.
It is vital that you keep track of your expenses. For each property that you rent out, you will need to spend money on maintenance and repairs. These types of expenses are tax refundable, so it is important to keep a note of them. This will make it much easier when it comes to sorting out your yearly tax bill.
Keep a note of expenses like petrol, landlord insurance from http://www.uklandlordinsurance.com and phone bills. As these are the kinds of expenses, that can be claimed back.
Have a notebook where you keep a note of every single expense, along with the date the expense occurred and what it was for. This will make it much simpler when you are trying to get your accounts in order prior to paying tax.
- Keep track of your income
Make sure to keep an accurate record of your income. This will make things easier for your accountant when it comes to dealing with your tax bill.
Write down your income from each month in a notebook, so that you have a clear record of how much you earn each month.
- Be organised with your expenses
There is nothing worse than having to search the entire office for every receipt and document you need for your tax. To prevent this from happening, it makes sense to be organised with your expenses and keep your receipts and documents in order.
Store all your receipts in one file, to keep it as organised as possible, put receipts for each month in separate dividers. This will make it much easier for your accountant to sort out your tax for you.
- Do not throw your receipts away
Even after your annual accounts have been completed, do not throw your receipts away. Keep all receipts for six years, just in case tax disputes pop up or anything like that.
If you don’t keep them then, you don’t have any proof. So, it is vital that you carefully store your receipts in case they are required. After six years, however, you can then dispose of them.