Buy To Let – 5 things you need to know
- Additional Dwelling Supplement Tax (“ADS”) will apply to any property that you purchase which is added to your main residence. As at today’s date, the ADS tax level is 4% of the purchase price. That is if you are buying an additional property at £200,000 the ADS tax payable will amount to £8,000.
- Obtaining Finance. If you are taking out a mortgage you must ensure that it is a “buy-to-let mortgage”. We can put you in touch with an independent mortgage broker if you require assistance.
- If you plan to rent out the property, you must ensure that your property is compliant with the various regulations which relate to Gas Safety Certificates, Fire Safety, PAT Testing etc.
- If you do rent the property you must place the deposit within a Rent Deposit Scheme for safekeeping. If you fail to do this, you will be in breach of the law and you may be penalized by paying a fine (which can be a multiple of the deposit).
- You should enter into a tenancy agreement with your tenant and we would recommend that you contact a Solicitor who will be able to advise you on the lease terms before signing.
Posted by Agata Myszkowska