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Quicken

Letting Fees And Tax Efficiency

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I recently read on a site linked from here that landlord agency fees are tax deductible. Tenant fees are not.

So, for any given amount of agency income, it would be more tax efficient (from a system perspective) to charge all the fees to the landlord. The landlord won't mind if the agent informs them it's deductible, whereas excessive tenant fees deter tenants (bad for the landlord).

Is this an argument that could be suggested to the NLA etc?

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Tax deductibility only saves 20% of the cost of the fee, at a 20% tax rate - it does not offset the whole fee.

40 percent for higher earners. Also, it could form part of a capital gains only long term approach, with mortgage interest and fees together wiping out rental income. No?

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What does "no?" mean? Do you mean "couldn't it?"

It means, this is just a thought and I won't be put out if you say 'no, it's a silly idea'.

Cheers, Q

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