Here is how it usually goes. The company year ends. Some months later the accounts are prepared, and that is the moment tax gets discussed for the first time. You are told a number, and the only thing left to do is pay it.
Nothing was done wrong. It is just that by then almost every lever has gone.
What has already expired by the time the accounts are drafted
- A salary has to be reported through payroll at the time it is paid. It cannot be backdated once the year has closed.
- A dividend can only come out of profit that actually existed on the day you took the money.
- A pension contribution from the company has to be paid before the year end to count against that year.
- The timing of a large repair, and whether it lands in this year or the next, is a decision that only exists before the invoice is settled.
- Whether a purchase completes this side of the year end or the other side of it changes which year it affects.
Every one of those is a choice while the year is running. Afterwards it is just history being written down.
What changes
You get one conversation two or three months before your year end, every year. We go through what the numbers are likely to look like, what you need to take out of the company, and which of the decisions above are still open.
That is the difference between an accountant who tells you the number and an accountant who changes it.
The rest of the year, the job is making sure nothing is being left on the table: every relief and legitimate expense that applies to your rental income actually claimed, rather than assumed. A property specialist knows which ones those are, and raises them before you have to ask.
What this looks like in practice
- A review ahead of your year end, not after it
- Your profit extraction planned as a whole: salary, dividends and the director's loan account together, rather than one at a time
- Every allowable expense and relief on your rental income identified and claimed
- The repairs and improvements line drawn properly, so you are neither overpaying now nor claiming something you should not
- A straight answer on what you can take out of the company, and what it costs you
Who this is for
Landlords whose property sits in a limited company, whether that is your first or your fifteenth. It matters most if you are growing, because that is when the decisions compound.
It matters least if your company is dormant or you have already decided to sell up, in which case we will tell you that rather than sell you a service.
Every portfolio is different, and what any of this is worth depends on your rate of tax and how your companies are set up today. The call is where you find out what applies to yours.