Property accountant London
Specialist property accountants serving landlords across London.
London buy-to-let is the most heavily taxed corner of the UK residential market. High values push every purchase into the 5% additional-dwellings stamp duty surcharge, low gross yields mean mortgage interest swallows a large share of rent just as Section 24 removes the deduction, and company-held flats over £500,000 fall inside the ATED regime. We work with landlords and investors across the capital on the decisions that actually move those numbers.
Specialist property accounting services in London
Section 24 modelling and the incorporation decision
London landlords are hit hardest by Section 24 because of high values and high gearing. We model your post-Section-24 personal position against a limited company across three scenarios (retain and reinvest, draw all profits, a mixed strategy) with the transfer costs included.
Pre-purchase SDLT and completion timing
Six standard bands interacting with the 5% additional-dwellings surcharge and the 2% non-resident surcharge. On a purchase above £1m the difference between two completion dates can run into five figures.
ATED relief returns
Company-held residential property over £500,000 sits inside ATED. Most genuine buy-to-let companies qualify for relief, but relief is not automatic: the declaration return is due by 30 April each year, and missing it creates the full charge.
60-day CGT filings
London disposals routinely exceed £100,000 of gain, so the 60-day window is the most-missed deadline we see. We draft the computation from the exchange paperwork and file in parallel with the post-completion legal work.
MTD for Income Tax
Quarterly digital reporting has applied since 6 April 2026 above £50,000 of qualifying income. We set up compatible software, map each property's rent account to the right categories, and handle the submissions.
Why choose a specialist for London property?
Tax law is national. The way it lands in London is local. An entry-level Zone 3 one-bed at around £400,000 attracts the additional-dwellings surcharge from the first pound. Central London gross yields of 3.5% to 4.5% on a 75% LTV mortgage mean the interest line is a huge fraction of rent, and Section 24 now puts that line above the taxable-profit line. A ten-year-held Zone 2 flat carrying a £200,000 gain is routine, and the CGT annual exempt amount is only £3,000.
Section 24 in a London portfolio: a worked example
Take a higher-rate taxpayer on PAYE of £85,000 with three flats in Wandsworth. Gross rent across the three is £72,000, mortgage interest at 75% LTV is around £35,000, and other allowable costs are £9,000.
Under the pre-2017 rules, taxable rental profit would have been £28,000 and the tax at 40% would have been £11,200. Under the current rules interest is not deducted, so taxable profit is £63,000, tax at 40% is £25,200, and the Section 24 basic-rate credit of 20% on £35,000 gives £7,000 back. Net tax on the rental is £18,200.
The same cash position now produces £7,000 more income tax. The higher headline profit also drags the taxpayer further over the £100,000 personal allowance taper, costing more again on the employment income. That gap is the trigger for most London incorporation conversations, though it is not automatically the right answer.
Stamp duty on a London buy-to-let purchase
The additional-dwellings surcharge has been 5% since 31 October 2024, up from 3%. It sits on top of the standard residential rates, and from 1 April 2025 the 0% band ceiling reverted to £125,000.
- £0 to £125,000: 0% standard, 5% with the surcharge
- £125,001 to £250,000: 2% standard, 7% with the surcharge
- £250,001 to £925,000: 5% standard, 10% with the surcharge
- £925,001 to £1,500,000: 10% standard, 15% with the surcharge
- Above £1,500,000: 12% standard, 17% with the surcharge
- Non-UK resident purchasers add a further 2% on the whole price
ATED on company-held London property
Annual Tax on Enveloped Dwellings applies to residential property worth more than £500,000 held by a company, a partnership with corporate members, or a collective investment scheme. Central London flat values cross that line routinely, so a lot of London buy-to-let companies are inside the regime.
The charge runs in six bands, indexed each April, starting around £4,600 for the £500,001 to £1m band and rising to roughly £303,000 above £20m. Most genuine buy-to-let companies escape the charge through relief, which requires the property to be let on commercial terms to an unconnected tenant throughout the chargeable period. Relief has to be claimed on a declaration return filed by 30 April each year even where no tax is due.
Borough-level licensing and how it is taxed
Most inner and central London boroughs run additional or selective licensing schemes. Tower Hamlets, Newham, Brent, Hackney, Waltham Forest, Croydon and parts of Lewisham and Southwark all operate wide-area designations, and mandatory licensing applies to every HMO of five or more occupants forming two or more households.
Licence fees are revenue expenses, deductible in the year paid or spread under accruals where the licence covers several years. Fines for letting without a required licence are not deductible, and neither are the legal costs of defending an enforcement action, so the compliance check belongs before exchange rather than after.
Non-resident landlords with London property
A significant share of central London buy-to-let is held by non-UK residents. Under the Non-Resident Landlord Scheme, either the letting agent withholds basic-rate tax from net rents and pays it to HMRC, or you register (form NRL1 for individuals, NRL2 for companies) and receive rents gross with the tax settled through Self Assessment.
UK rental profits are taxed at UK rates regardless of residency. Non-residents pay the extra 2% SDLT surcharge on purchase and must report any UK residential disposal within 60 days, even where no UK income tax return would otherwise be due.
Inheritance tax on a London portfolio
A central London portfolio is often the largest asset a family owns and it is fully exposed to inheritance tax. Residential letting is treated as an investment rather than a trade, so Business Property Relief is not available and the portfolio sits in the estate at full market value.
The levers are long-term: lifetime gifting (which can trigger an immediate CGT charge on the deemed disposal, so the CGT and IHT positions have to be weighed together), trusts, and gifting shares where the portfolio already sits in a company. None is a default answer, which is why succession belongs in the same conversation as the incorporation modelling rather than being bolted on later.
Areas we serve in and around London
We work with landlords across all London boroughs, from Central London (Westminster, the City, Camden) to the north (Barnet, Enfield), south (Croydon, Bromley), east (Tower Hamlets, Newham) and west (Ealing, Hounslow).
We work with landlords across the UK, and we understand the specific dynamics of the London property market. Remote support with local market knowledge.
London landlord tax questions
Can I offset mortgage interest against my London rental income?
Not directly. Since 6 April 2020 individual landlords cannot deduct mortgage interest from rental income. Section 24 gives a 20% basic-rate tax credit on finance costs instead, so a landlord with £40,000 of interest receives an £8,000 credit whether they are a basic-rate, higher-rate or additional-rate taxpayer. Limited companies are outside Section 24 and continue to deduct interest in full.
What is the SDLT surcharge on a London buy-to-let in 2026/27?
5%, in force since 31 October 2024. On a £600,000 flat the total is £50,000: £20,000 of standard SDLT plus £30,000 of surcharge. A non-resident buyer adds a further 2% on the whole price, taking the bill to £62,000.
When does it make sense for a London landlord to incorporate?
Most often for higher-rate or additional-rate landlords with mortgaged portfolios who intend to retain profits for reinvestment rather than draw them, and who expect to hold for at least five to seven years. The decision has to weigh the SDLT on transferring existing properties in (a transfer to your own company is treated as taking place at market value), the CGT on the deemed disposal, and the cost of refinancing residential buy-to-let loans into company products, which typically price higher.
What expenses can I claim as a London landlord?
Letting agent fees, repairs and maintenance (not improvements), buildings and contents insurance, ground rent and service charges, gas safety and EICR certification, accountancy fees, advertising for tenants, replacement of domestic items on a like-for-like basis, and travel for property management. Improvements are capital and are added to the base cost for CGT instead. Mortgage interest is not deductible but generates the 20% credit.
Does ATED apply to my company-held London flat?
If the property is worth more than £500,000 and is held by a company, ATED applies unless relief is claimed. Most genuine buy-to-let companies qualify for relief because the property is let on arm's-length terms to an unconnected tenant, but the relief declaration return still has to be filed by 30 April each year. Missing that filing creates a charge even where relief would have applied.
How does MTD for Income Tax affect London landlords?
It has applied since 6 April 2026 to sole-trader landlords with qualifying income above £50,000, falling to £30,000 from April 2027 and £20,000 from April 2028. London landlords are disproportionately affected because Zone 1 to 3 rents push most multi-property portfolios over £50,000 quickly. You keep digital records, submit quarterly updates through compatible software, and file a Final Declaration by the following 31 January. Limited companies are outside the regime.
What CGT rate applies when I sell a London buy-to-let?
18% on the part of the gain falling in your remaining basic-rate band and 24% above it, with a £3,000 annual exempt amount for 2026/27. The disposal must be reported and the tax paid within 60 days of completion through HMRC's UK Property service, separately from the Self Assessment return.
Do I need a London-based accountant for my London property?
Not strictly. Tax legislation is national, so what matters is property specialism rather than postcode. The London-specific value sits in three places: knowledge of borough-level licensing, which varies sharply between boroughs, familiarity with the leasehold and service-charge structures of the big central developments, and benchmarks calibrated to the London letting market.
How did the abolition of the furnished holiday lettings regime affect London short lets?
The regime ended on 6 April 2025. Former FHL properties are now treated as ordinary residential lettings: no capital allowances on furnishings, no pensionable trading income, no business asset disposal relief on sale, and Section 24 applies to the mortgage interest. Many short-let operators in Zones 1 and 2 were affected.
Do borough licensing costs affect my tax position?
Yes, in your favour on the fee itself. Licence fees are revenue expenses deductible against rental income. What is not deductible is any fine or penalty for letting without a required licence, or the legal cost of defending the enforcement action, and a rent repayment order can run to two years of rent.
When should I switch property accountants?
If nobody has modelled your post-Section-24 personal position against a company, if MTD registration was never raised with you, if your adviser still refers to a 3% SDLT surcharge or a £6,000 CGT annual exempt amount, or if your portfolio is being treated as several separate tax returns rather than one planning unit.
What is the difference between a property accountant and a general accountant?
A generalist may still treat mortgage interest as a deductible expense, may miss the 60-day CGT reporting window, and rarely models incorporation. A property specialist gets all three right by default because rental income, disposals, ATED, the Non-Resident Landlord Scheme and the ownership-structure question are the core of the work rather than an occasional sideline.
How to get started
Book a free consultation to discuss your property tax situation. We'll give you clear recommendations, with no obligation and no hard sell. What it costs depends on the size and structure of your portfolio, so we will talk that through rather than quote blind.
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Speak to a property accountant for your London portfolio
Tell us about your portfolio and we'll explain how we can help with Section 24, MTD, and incorporation planning.