Property is important to just about everyone. For many of us, most of our personal wealth is tied up in our real estate. Buying our own home is quite often the most important financial decision that we will make in our lifetime. In the eyes of some, ‘bricks and mortar’ is the safest and most tangible asset we can own. It is what we work all our lives to pass on to our children.
At AA Accountants UK Ltd we understand how important your property is to you. We recognise that so often it is easy for decisions about property to carry a burden of emotional attachment. As a result, the value of our property holdings may not always be as great as it could be. We can work with you sensitively to help you to realise the full potential of your property.
Property as an investment:
When you consider investing in property it is useful to think about the following steps:
SET your property investment goals. Be clear what you want to achieve.
- Is it simply a case of finding a place to live or do you want to use your property to increase your wealth? The two are not necessarily mutually exclusive;
- Are you more interested in capital gain or rental income?
- Is property really the best option for you? Remember, although property can be very valuable, it usually takes a long time if you need to convert it to cash;
- What is an achievable rate of return?
- We can show you how set your goals to achieve what you have in mind;
- UNDERSTAND your financial position, this will tell you what is possible. With our experience, we can quickly arrive at a comprehensive understanding of your financial position;
DEVELOP a plan that will bring your dreams to reality, taking account of what you can afford. This will include developing strategies for capital growth, and minimising your tax. It will integrate your vision for your property with your overall earning capabilities and capacities. For example,
- Is it to be part of a negative gearing plan whereby losses in your property investment increase your net earning potential? This is the area where the rules can be highly technical and complicated and the advice of your accountant is usually essential;
- How much should you borrow?
- What arrangements do you make to repay any debt and over what period?
- Determine the medium of investment. Which is more suitable, investing in property directly or through a trust or similar arrangement?
- Settle on the arrangements for managing your property. Again, we can provide useful advice on this;
SET up the record keeping and monitoring arrangements. We provide a comprehensive bookkeeping service to help you do this. We can even do it online to do it more efficiently to;
- Produce your tax, and VAT returns and satisfy all local and national obligations;
- Assess how well you are achieving your goals.
Property as Part of Estate Planning:
What will happen to my property when I am gone? Will it pass easily to my family? Will it be tied up in law suits? Will the tax man take too much? With a little bit of planning now you can see to it that your family receives all that you want them to. It is wise to consult a lawyer about a will; but, here at AA Accountants UK Ltd, we can ensure that your financial affairs are arranged to minimise any future problems and ensure that the executor can carry out your wishes quickly.