Using contractors to carry out works on behalf of landlords

In recent years, the UK property sector has undergone massive changes due to the massive increase in popularity of “buy to let.”

Not only have many more people bought properties to rent out, but also a whole section of the economy based around various contracted-out tasks has seen the benefit.

For landlords, there can be many positive reasons to use various contractors to do work on their behalf, but there are also some common pitfalls that must be avoided.

Multiple properties

For those with only one or even two properties, a “hands-on” approach can be a practical way to get things done.

However, some people will not have the time to do everything necessary, and if you are lucky enough to have a growing portfolio of properties, then there comes a point when it is simply unrealistic to think you can manage everything on your own.

What do contractors do?

Essentially, any individual or company who comes onto a property to do contracted work between a landlord and a third-party company is a "contractor."

This means everything from cleaning services, telecoms engineers, plumbers, electricians and a wide range of maintenance engineers falls into the category.

Possible pitfalls

Although there are many positives for the case for using contractors, there can be cons too.

Clear responsibilities must also be laid out regarding the work to be done and the areas in which the contractors can and cannot operate. Also, using multiple contractors can cause problems for landlords when it comes to paying them.

Would an umbrella company help?

An umbrella company offers PAYE status to independent contractors working under temporary contractors, making it easy for individuals to move between jobs with the processing of tax and national insurance liabilities taken care of in a simplified way.

For landlords, this can make things much easier because they only have to deal with one reputable company to make payments to contractors, and can therefore avoid any problems with requests for “cash in hand” or any extra outlays.

One stop shop

In effect, an umbrella company means that landlords don’t have to worry about dealing with lots of different payment schedules or invoices from individuals, and don’t have any worries about being involved in tax avoidance by workers they have hired.

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