If you have a mortgage on the property, you should notify your mortgage lender that you are thinking of letting the property. It is usually one of the conditions of your mortgage that you apply for permission to sub let, except if the mortgage is a buy-to-let which is designed for the purpose of letting.
It is wise to check with the freeholder that there are no restrictions or covenant which prevent you from letting the property. There also may be conditions within your lease that the Tenants must adhere to during the Tenancy period. If this is the case, you should supply a copy of these lease terms to the Tenants.
You should advise your property insurers that you are letting the property in case it is necessary to alter any terms. Tenants are responsible for insuring their own furnishings and belongings but a Landlord must ensure he has appropriate cover in place for the building and any contents, fixtures and fittings belonging to the Landlord.
Non UK Resident Landlords
If you are going to reside outside of the UK for more than six months a year, you must apply to H M Revenue & Customs for approval to receive rents with no tax deducted. HMRC will forward an approval notice to SIS Properties. Otherwise, SIS Properties are legally bound under the Taxes Management Act 1970 to deduct from the rent, income tax at the basic rate, before it is forwarded to the Landlord.
More information can be obtained from www.hmrc.gov.uk/cnr/nr_landlords.htm.
It is important to have several keys cut for the property, enough for one set per adult Tenant due to move into your property, plus a set for us to conduct viewings and if applicable, to manage the property after the tenants have taken occupation.
Should there at any time be a need to take legal action against the Tenants for whatever reason, the Landlord is responsible for this action, plus any necessary costs incurred. For managed properties, assistance will be given regarding documentation and administration for the tenancy. SIS Properties recommend that Landlords consider protecting themselves by taking out legal expenses insurance policy, which we can arrange for you at any time.
Landlord Tax Guide
While an income from property letting is always welcome, there are some tax implications that you need to be aware of. Here’s a quick guide to your tax liability as a landlord.
UK Resident Landlords
If you are a landlord who lives in the UK, any profit you make from renting your property will be subject to Income Tax. When we collect the rent on your behalf, we don’t deduct any tax from the rent we pay you, so you will need to inform the Inland Revenue of this income yourself.
There are a number of expenses that can be offset against rental income and we would therefore recommend that you contact an accountant to find out more.
Non UK Resident Landlords
If you are treated as a non-resident landlord for UK tax purposes, you will still have to pay UK income tax on any profits you receive from renting your property. In these circumstances, we are obliged by law to deduct basic rate tax from any rent we collect and send it to the Inland Revenue on a quarterly basis.
To qualify for an Exemption Certificate, the Inland Revenue usually require that:
- Your UK tax affairs are up to date, or
- You never had any UK tax obligations, or
- You do not expect to be liable to UK income tax
If your property is in joint names we will need one certificate for each of the joint owners and we will need to receive the Exemption Certificate(s) before we can pay your rental income gross.
Transfer of Services/Utilities
If you have employed SIS Properties as your Managing Agent:
The only service we are not able to transfer for you is the telephone, as BT or cable companies will only deal with the subscriber, not a third party. For all other services, please provide us with information on the existing utility suppliers of the property and location of the meters.
If SIS Properties are not managing the property, you will need to arrange:
Gas and Electricity - inform them of the date of transfer to the new tenants, plus their names, the meter reading and your forwarding address so they can send you a closing account.
Water Rates – water rates become the tenants’ responsibility in most cases. Please inform the water supplier of your new tenants’ details and your forwarding address. If you water charges are on a meter then you will also need to supply the meter reading.
Council Tax – once again this is payable by the tenants during the tenancy. Please advise the local authority the date of the transfer to the new tenants and of your forwarding address in order that they can send you the closing account.
Telephone – It is best to arrange the transfer for the actual day that your tenants move in. If there is a break between subscribers, there can be a charge depending on the length of time the service has been disconnected.
Mail Redirection - Royal Mail offers a service to redirect your mail, which we recommend you arrange prior vacating the property. You should also inform your bank, employers, friends and family who are likely to write to you, of your new address.
LETTINGS - MANAGEMENT - MAINTENANCE - REFURBISHMENT