Landlords in the UK are increasingly depending on accountants for helping them to make key decisions in the buy to let sector, it has been revealed.
A survey of 500 landlords highlights that 58% of them admit to consulting with an accountant when it comes to making property decisions and in helping them to navigate tax changes in the BTL sector.
In addition, a further 10% of landlords say they will consider using an accountant in future.
In addition, researchers say that 75% of full-time landlords use an accountant currently, and 25% of landlords questioned said they had just begun using an accountant.
Growing reliance on accountants by landlords
One of the issues for the growing reliance on accountants by landlords may be down to the recent government-imposed changes to a landlord’s tax regime.
Among these are the phasing out of mortgage tax relief for landlords and new stamp duty charges.
Also, last year Kent Reliance revealed that 19% of landlords had created a limited company in a bid to offset the tax relief changes that were brought in by the government in April 2017.
The findings also highlight that those landlords who have been affected by recent changes to tax are also increasingly likely to be interested in diversification of their portfolio – away from ‘vanilla’ buy to let properties and instead moving into higher yielding options including student accommodation and HMOs.
Kent Reliance also points out that these landlords are also looking at diversification opportunities in commercial and semi-commercial properties.
‘Evidence of the sector’s growing professionalisation’
The sales director of OneSavings Bank, Adrian Moloney, said: “There is evidence of the sector’s growing professionalisation as full-time and portfolio landlords take more market share.
“We will see further use of professionals, such as accountants, which is good for the BTL sector with landlords benefiting from accessing advice before making a key property decision, particularly on any tax implications.”
He added: “With more landlords moving into a limited company structure, it will offset the effects from tax changes but will require more detailed accounts and professional tax advice.”
The findings also highlight that 51% of buy to let mortgage brokers have also been approached by landlords who are looking into diversification with 14% of these landlords looking at the potential of commercial property and 56% into HMO opportunities.