If I reduce my self-employed income for tax purposes it shouldn’t impact my ability to get a mortgage…should it!?
In the majority of instances – YES…it absolutely will!
It is most definitely a catch 22 situation when you work for yourself but are also looking to get a mortgage. You want to minimise your tax bill and be as tax efficient as possible which can mean reducing your profits. The result….a reduced amount you can subsequently borrow to fund your first or next property purchase.
If you know you are going to be looking to take the plunge and buy your first property, or you may be planning the next step on the ladder, then forward planning is essential. To help get yourself in shape to buy it is best to look at what you earn and, if different, what you need to earn- and take advice from your accountant to achieve this.
Sometimes a smaller tax bill one year can stand in the way of the purchase of your dream home the next. Don’t let this happen to you. Catch 22!
We can talk you through the above in more detail as well as give you some tips to get yourself in shape, ready to make your first or subsequent self-employed mortgage application. Call me on 0131 303 0029 or email me at Rebecca.firstname.lastname@example.org