New Year’s resolutions aren’t exactly a modern fad. In fact, January is named after the Roman god Janus, whose two faces look in opposite directions – one into the past, and one into the future – and has long been considered a time for taking stock of what has been, and planning for what will come.

(Janus was also considered somewhat ambivalent, which might go some way to explaining why many resolutions don’t make it to February.)

So now that 2015 has found its stride and February is just round the corner, it’s a good time to take stock. Which business resolutions have you kept, and which have you neglected? What changes could benefit your business? What does 2015 have in store that you should plan for?

Below are five broad resolutions that usually make for good advice for any landlord at any time.

1. Make sure your tax affairs are in order

2014 saw a fair few changes to the tax and pensions system. Withdrawing pension funds became an awful lot easier, but on the flipside, the amount of capital gains tax relief that landlords who had previously occupied their homes could claim was halved ¹.

In addition, HMRC bolstered their efforts to crack down on the thousands of landlords who are believed to underpay a collective £500 million in tax per year. Last year, as part of the ‘Let Property Campaign’, HMRC sent out tens of thousands of letters to landlords suspected of tax avoidance.

HMRC offers an olive branch in one hand and a knife in the other: reduced penalties on unpaid tax for landlords who come forward ² and the possibility of criminal proceedings for those who don’t.

This 18-month amnesty was announced in September 2013, meaning that it due to end very soon. So if you’re in any doubt that your tax record is squeaky-clean, strongly consider speaking to a professional accountant as soon as possible.

2. Stay abreast of changes in the law

Last autumn, new legislation that will require landlords to conduct ‘right to rent’ immigration checks on their tenants was trialled in some areas of the West Midlands ³. The rest of the UK should see checks introduced gradually throughout this year.

This is just one example of the constantly shifting legal climate that landlords live in. Another is the growing pressure on the government to legislate for longer tenancies and greater tenant protection. Whilst this is not yet mandated, the ‘model tenancy agreement’ launched by DCLG last September is of potential use to landlords who want to ensure they follow best practice.

3. Review your mortgage finance

The Bank of England base rate (BBR) has sat at a measly half a percent since 2009. A slowdown in economic growth postponed what many thought would be an inevitable rise last year, and a month of rock-bottom inflation in December has now potentially pushed it back to the beginning of 2016.

For some borrowers, this is still soon enough to merit fixing their mortgage rates. For others, there is breathing-room enough to continue capitalising on cheaper variable rates for a while longer. But whatever your attitude to risk, the fact is that mortgage finance is currently very cheap and readily available. There are a huge number of loans available, and thanks to a competitive market, they are becoming ever cheaper and more flexible.

By regularly reviewing how your portfolio is financed, you may be able to reduce your monthly overheads or release funds for further investment.

4. Keep in contact with your tenants

Be honest: when was the last time you touched base with your tenants? It can be all too easy for periodic inspections to fall by the wayside after a few months pass with no issues, and before you know it it’s half a year or more since your tenant was reminded that you exist!

Keeping in regular contact with your tenants has two benefits: it keeps you abreast of any changes in their circumstances that might affect your working relationship, and it reminds them that you are available should problems arise with the property.

This is not to say that you should pry into your tenant’s life or interrupt their right to the quiet enjoyment of their home. A quarterly inspection (subject to the requisite 24 hours’ notice and conducted only with your tenant’s permission, of course) should be enough to maintain a non-invasive relationship.

5. Keep in contact with fellow landlords

No-one is an island, as the saying goes, and the greatest advantage of living in the information age is that for any given problem, any number of expert opinions is immediately and freely accessible to anyone with an internet connection.

The same is true of the numerous online communities of landlords that offer a wealth of guidance and information to their members. Cooperative rather than competitive, these communities are built on a foundation of shared experience and knowledge.

So whether you need to ask for help or wish to offer it, know that the opportunity to do is just a mouse click away.

Written by Ben Gosling for www.commercialtrust.co.uk

 

References

1. Gosling, B. “Changes to CGT among measures announced in Autumn Budget”. Commercial Trust. 5 Dec 2013.
2. Caldwell, K. “Pay your tax or face the consequences, minister tells buy-to-let investors”. The Telegraph. 19 Sep 2013.
3. “West Midlands to be first landlord ‘right to rent’ check area”. UK Home Office. 3 Sep 2014.
4. Khan, M. “Tumbling oil will keep rates on hold until 2016, warns forecaster”. The Telegraph. 17 Jan 2015.