Hi, I’m looking to rent a property but I’m getting mixed answers from some estate agents in regard to showing proof of earnings for being self employed. Some estate agents are asking for my gross profit while others say it’s my net profit. My gross is pretty much double my net and would find it impossible to rent if they do go off that.
Would anyone be able to let me know what they should be going off so I can start searching for a property in my price range.
The rental market is very difficult for self employed people at the moment because landlords ard afraid of taking the risk. If you have your own company then in many ways it doesn’t make sense to look at the gross figure as its the company’s money not yours. The problem is though that many self employed Directors take a combination of salary and dividends and often try to keep the salary low to minimise tax and NI. This never looks good on an affordability assessment but doesn’t really reflect the true financial position for the applicant.
I think the only thing you can really do is make your full financial circumstances clear in a statement and ask the referencing company to consider it and make it available to the landlord. I have taken self employed tenants that have failed referencing once I know the full facts.
It would be your net usually. And often, your taxable profit because that is what you can prove from your SA302s (or equivalent tax year overviews).
Referencing agencies usually ask for tax returns to confirm income when self-employed.
Thanks. I’m not a limited company so don’t take dividends - sorry I should have said I’m a sole trader. It’s just confusing and makes it hard to look for a property when one company ask for my gross and others asking for my net