How to calculate rent in London?

How to calculate rent in London? London residential properties advertised for rent in Rightmove, the asking rent is usually per calendar month and/or per week. For example, a one-bedroom apartment in London Mayfair is £550 per week. This article focuses on how to calculate rent in London for residential properties only. This is an essential “know-how” for new properties owners.

Calculate rent per month

You take £550 per week x 52 weeks then divide by 12 months. The rent per month is £2383.33

Calculate weekly rent

Say, a two bedrooms apartment in London Regent Street is advertised as £3000 per calendar month. To calculate the rent per week from the monthly rent of £3000, you take £3000 x 12 months then divide by 52 weeks. The rent per week is £692.31.

New to London property letting business

If you are thinking of starting a London property letting business or new to this business, knowing how to work out your rent is essential so that you can work out your profit on your letting.

For example, to make a profit on your London apartment, you must achieve a minimum rent of £3500 per month.

You work out your rent per week that is £3500 x 12 months divided by 52 weeks gives you £807.69 per week. To achieve your minimum rent, you may ask your estate agent to advertise your London apartment for £810 per week rent or more.

Using a limited company for your properties letting business

If you are using a limited company for your properties lettings, you must also comply with the Companies House requirements. You must deliver the following documents to Companies House every year.

You can submit your company documents online. You would require your company’s authentication code to do so. The authentication code is the electronic equivalent of your company’s director(s) signatures. Hence, you must keep it safe.

In addition, you must also submit your corporation tax return to HM Revenue and Customs together with your company accounts.

If you require help with your company’s filings, contact our accountants. They will be more than happy to assist you.

Tenant Fees Act Landlord must know

Tenant Fees Act landlord must know. The law is to protect tenants from paying excessive fees associated with renting a property in England. The Tenant Fees Act comes into effect from 1 June 2019.

Prohibited tenant fees from 1 June 2019

Private landlords and letting agents are banned to ask tenants to pay the following fees for tenancy contract entered into AFTER or on 1 June 2019.

  • Referencing
  • Administration
  • Inventory check-in and check-out report fee
  • Renewal of tenancy fees

Grace period

Except where tenants entered into a contract with you BEFORE 1 June 2019. In this circumstance, you can ask your tenants to pay for renewal and check out fees up to 31 May 2020.

However, if your tenant signed a tenancy renewal contract with you, say 13 October 2019 to 12 October 2020 then you cannot charge your tenant a renewal fee because the contract was signed after 1 June 2019 not before 1 June 2019.

Some letting agents were charging tenants renewal fees after the grace period claiming that they could do so up to 31 May 2020. This is unlawful. Your tenant can make a complaint to the enforcement authority.

From 1 June 2020, landlords and letting agents are banned to charge referencing, administration, inventory check-in, inventory check out report fee including tenancy renewal fee.

Permitted tenancy fees from 1 June 2019

If you are running a property letting business in England, you can ask your new tenants to pay the following.

  • The agreed rent.
  • a refundable 5 weeks tenancy deposit where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above.
  • Ask your potential tenant to pay one week refundable holding deposit to reserve your property. No more than 1 week.
  • Tenant to pay the associated early termination of the tenancy fee, when requested by the tenant
  • You can charge your tenant for the variation, assignment or novation of a tenancy. The payment is capped at £50 or reasonably incurred costs, if higher.
  • payments in respect of utilities, communication services, TV licence and Council Tax of the rented property.
  • a default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement.

Further reading about the Tenant Fees Act, click here.

Companies House filings

If you are running your property letting business through a limited company registered with Companies House, you must comply with the Companies Act too.

You can submit your company documents to Companies House online. You would require your company’s authentication code to do so. The authentication code is the electronic equivalent of your company’s director(s) signatures. Hence, you must keep it safe.

The documents you can file online includes:

Companies House has also created an interim paperless filing service to accept documents which would normally require a live signature during COVID-19 pandemic. You can easily upload your documents to the Companies House website.

If you require help with your company’s filings, contact our accountants. They will be more than happy to assist you.

Fix your Bike Voucher Scheme

The Department for Transport in England introduces the Fix your Bike Voucher Scheme to encourage the public to cycle. The scheme was announced on 22 June 2020 with the objective to reduce the number of short journeys by cars and as an alternative to public transport during the COVID-19 pandemic.

Cycling is more environmental friendly

Cycling is more friendly to our environment because of no harmful gasses emission to the air comparing to using cars. In addition, it is more cost-effective for you if it is a short journey.

The London Ultra Low Emission Zone (ULEZ) was introduced and implemented in April 2019 within the same area as the Congestion Charge zone.

Cars and vehicles do not meet the Ultra Low Emission Zone standards must pay a ULEZ charge in addition to paying the Congestion Charge.

For example, if your car does not meet the ULEZ standards and you drive from Pimlico (postcode: SW1V 4PY) into the Congestion Zone, say, to Regent Street London (W1B 5TD) to shop for a day. You will have to pay the Transport for London, £15 for Congestion Charge and £12.50 for ULEZ charge. Total of £27.50 for the day. If you forgot to pay you would receive a more expensive penalty charge.

The journey from Pimlico to Regent Street is a relatively short journey. If you cycle to Regent Street instead of taking your car, you save the £27.50, the fuel and also parking fee. so, why not cycle?

Bike repair voucher up to £50

You can use streets bikes or your own bike for your short distance trips. The Fix your Bike Voucher is for use to repair your own bike. The voucher is to be used toward the cost of repairing your bike, up to £50 per bike. You must be 18 years old and above.

This voucher can only be used at the bike repair shops that participate in the Fix your Bike Voucher Scheme. You can find them nationwide in the Energy Saving Trust website here.

Here are some of the participating bike repair shops close to Regent Street in London where our office is based.

1Camden Cycles Limited
241 Eversholt Street
Camden Town London
Postcode: NW1 1BE

Phone: 020 7388 7899
2Evans Cycles West End
62 Mortimer Street,
London
Postcode: W1W7RR

Phone: 020 7637 1940
3Cloud 9 Cycles
38 Store St
Bloomsbury
London
Postcode: WC1E 7DB

Phone: 0203 20 50 190
4Decathlon High Street Kensington
146-158 Kensington High St,
Kensington London
Postcode: W8 7RL

Phone: 07483 051426
Source: Energy Saving Trust – Department for Transport UK

Calling Bike repairer in England to register for the Fix your Bike Voucher Scheme

If you are a bike repairer, you can register to participate in the scheme with the Energy Saving Trust (Department for Transport) here.

Companies House filings during COVID-19 pandemic

Companies House also gear up to support UK businesses during COVID-19 pandemic. They automatically extend your company’s filing deadline. This will help your company to avoid a late filing penalty if you are unable to deliver your company accounts on time. You do not need to do anything. You just need to go to Companies House website to check your new filing deadline.

Concurrently, your confirmation statement filing deadline will also be extended. You would have 6 weeks to file your confirmation statement. Similarly, for the events driven filings, you will have 42 days (6 weeks) to notify Companies House instead of the usual 14 days filing deadline.

In addition, Companies House also created an interim paperless filing service to accept documents which would normally require a live signature.

You are encouraged to file your company documents to Companies House digitally. You can use the web filing service to submit the following documents to Companies House.

To file online, you would require your company’s authentication code. The authentication code is the electronic equivalent of your company’s director(s) signatures. Keep safe your authentication code.

If you require help with your company’s filings, contact Our accountants. They will be more than happy to assist you.

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