How To Avoid Tax On Investment Property: As a property investor, knowing the right laws can literally save you thousands! In a recent video, I reveal six game-changing property laws that many investors – and even solicitors – are unaware of! These legal loopholes can help you slash acquisition costs, avoid unnecessary stamp duty, maximise rental income, and reclaim VAT on refurbishments.
If you want to know how to avoid tax on investment property legally, and gain other benefits as a property investor, please watch the full video until the end. You can find the video at the top of this page or on my YouTube channel. On YouTube, you can also leave a comment letting me know if you found this list helpful!
In this article, I will summarise these 6 property laws that will help you legally avoid tax on your investment property, and otherwise benefit your property investments. This information is based on my experience of being in property full-time for 16 years, however I am not a lawyer or an accountant. Please seek independent professional advice before taking any action based on this information.
A lot of people are unaware of how to avoid tax on investment property, and therefore end up paying more than they need to. I want every property investor to learn how to use these 6 laws to their advantage, but I need your help to reach them! Please will you consider sharing this article on your social media pages? I notice and appreciate everyone who takes the time to spread the word!
1. How To Avoid Tax On Investment Property And Other Little Known Property Laws: Stamp Duty Exemption For Uninhabitable Properties!
If a property is deemed uninhabitable, it is considered stamp duty exempt on the first £150,000. A property could be considered uninhabitable if it does not have a kitchen, bathroom or heating, for example. Get a RICS surveyor to assess the property to provide evidence for HMRC!
2. Grandfather Rights For HMO Investors!
In some areas, you need planning permission to turn a property into a House in Multiple Occupation (HMO). This is known as an Article 4 area. However, if you can show that you were using the property as an HMO before the Article 4 direction came into place in the area, you are grandfathered in. This means you can keep using the property as an HMO without having to apply for planning!
3. Convert Commercial Units Into Residential Without Full Planning Approval!
Permitted development rights allow you to convert commercial property to residential without needing planning permission! Simply give the council notice of what you are planning to do via the prior approval process. It is then for them to object within 56 days, or you are free to do the conversion.
4. VAT On Property Renovations!
If a property has been empty for 2 years or more, you qualify for a reduced 5% VAT rate on renovation costs, instead of the normal 20%! You can prove the property was empty for 2 years via council tax records or utility bills. You can then work with a VAT registered contractor to apply the discount.
5. Zero VAT On Commercial To Residential Conversions!
If you are doing a commercial to residential conversion, you can pay 0% VAT on all the construction work. This is one reason that so many investors are moving into commercial to residential conversions right now!
6. How To Avoid Tax On Investment Property And Other Little Known Property Laws: Capital Allowances On Embedded Fixtures!
If you are buying mixed use or commercial property, you can claim capital allowances on embedded fixtures. These could include heating systems, fire alarm systems and electrical fittings. Even if you didn’t install them, you can claim them as tax deductions!
From How To Avoid Tax On Investment Property To How To Profit From Property!
Now that you know how to avoid tax on investment property (and benefit from little known property laws), it is time to learn how to make money from property in the first place! Join me at my next £1 training event!
We have different courses throughout the year, each teaching different things. Here is a sample of what you could learn on one of our popular £1 courses:
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Become a property investor using other people’s money so that you can get started straight away
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Utilise the 5 different types of raised finance so that you know exactly what to offer and when
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Find the perfect properties for the BRRR strategy
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Recycle your money so that you can ‘rinse and repeat’
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Build a power team you can trust, so that you can save time and money
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And much more!
Tickets are only £1, and you can get yours here. If you are ready to take action, I hope to see you very soon!
