While most houses owned by buy-to-let landlords tend to be relatively conventional in construction, this is by no means always the case. ‘Standard’ or ‘conventional’ construction is generally defined as applying to properties built of bricks with a slate or tiled roof. Obvious examples of non-standard properties include timber-built premises and those with thatched roofs, there are however many other forms of construction that demand special attention from insurance companies.

Perhaps one of the most common non-standard forms of building was once the post-World War 2 prefabricated home. But there have been many periods in the past when the need for rapid construction of homes has led to some experiments with building techniques, as well as some of the more deliberate attempts to create unique properties. Building regulations before the mid 20^th Century were far less restrictive than latterly and this could have resulted in some unusual builds.

Premiums

One of the questions insurance companies ask, when you take out a Landlord Insurance policy with them, relates to the construction of the property. As a general rule, in the event of inability to confirm that the property is of standard construction, many insurance companies will ask for an additional premium.

Difficulties and delays with claims

It is important to be aware that non-standard construction could lead to delays – and additional costs – in rebuilding after a fire or other damage. This means that care must be taken in assessing the right level of sum insured for the property. Where special materials have to be obtained to match existing ones, this can add considerably to the rebuilding cost and thus the amount of cover required.

The most obvious example of this is where the property is ‘listed’ and has to be rebuilt in a particular form and using as nearly as possible original materials. This can be very costly and you should seek professional advice if you own a listed building.

Making Sure

If you are uncertain about the construction of your building, you should ask for help; it is better to take a little extra care, than to find that your landlords’ insurance is inadequate, when the time comes for a claim.

Getting the Right Advice

It is important to seek independent professional advice before making any decision about your property owners’ property and liability insurance as well as your financial obligations. You should always ask your insurance advisers like Alan Boswell Insurance Brokers what experience they have of dealing with residential and/or commercial rental property insurance.

Nothing contained in the article should be considered as giving individual financial advice. Please note that there may be variations for those living in or letting property located in Scotland and Northern Ireland.

For more details visit: http://www.Alanboswell.com

Alan Boswell Insurance Brokers Limited

Harbour House
126 Thorpe Road
Norwich
Norfolk
NR1 1UL

01603 218000

With WikiLeaks threatening to release information about people with offshore money that is not declared for tax, it might appear that they have more to do than concentrate on ensuring that landlords pay the right amount of tax. But in fact HM Revenue and Customs appears to be as keen as ever to chase after what it might see as the ‘soft target’ of UK residents who inadvertently may not declare all their income.

Not always straightforward

There are exemptions from income tax for those letting rooms in their home for less than £4,250 a year (£2,125 if letting jointly) in total. But for everyone else – which will include most residential landlords – this is a business with the usual rules about all income less allowable expenses being subject to tax.

Confusion can arise over what are legitimate business expenses and it is here that opportunities arise for errors. For example, setting Landlords Insurance, agents’ fees and maintenance costs against tax is usually perfectly legitimate, but some other costs may be less easy to determine. For example, running a car out of the business to visit your premises may be challenged if you only let out the house next door!

And, of course, any capital gains are potentially liable to tax, because this is not the owner’s principal residence; so an increase in value could, on eventual sale, incur tax at 18% or 28%.

Has anything changed?

Apart from the fact that the government needs to find every penny it can to help reduce its borrowings, there is nothing new in HMRC seeking to collect tax where it may have been missed. Indeed, many accountants already recommend insurance to cover the cost of an HMRC investigation into clients’ tax affairs, because the time and effort involved can be significant. This is generally included in a Landlord Insurance policy, but should always be checked and confirmed when taking out the policy.

But HMRC does not confine its interest just to those landlords it knows about from previous returns. It is also looking hard to discover residential and commercial landlords who are not declaring their taxable income at all – perhaps because they do not realise that they need to do so. This campaign has been going on for several years and can be expected to continue.

It is important to be aware that an HMRC enquiry could result not only from information that it has – for example that you have a buy-to-let mortgage – but also from ‘profiling’ that suggests you may have property that you let. It also appears that some enquiries are initiated on a random basis; and once started, simply having done nothing wrong in your tax affairs is no defence – you have to be able to demonstrate this to the taxman’s satisfaction.

Getting the right advice

It is important to seek independent professional advice before making any decision about your property owners’ property and liability insurance as well as your financial obligations. You should always ask your insurance advisers like Alan Boswell Insurance Brokers what experience they have of dealing with residential and/or commercial rental property insurance.

Nothing contained in the article should be considered as giving individual financial advice. Please note that there may be variations for those living in or letting property located in Scotland and Northern Ireland.

For more details Visit: http://www.Alanboswell.com

Alan Boswell Insurance Brokers Limited

Harbour House

126 Thorpe Road

Norwich

NR11UL

UK

01603 218000

info@alanboswell.com