01908 774323 Helen@Essendontax.co.uk
When renting a property there is a lot of interpretation around the reliefs available to the landlord. One of these is for repairs and replacements on a like-for-like basis, so it is important to understand what HMRC allows and what it frowns upon.
Up until 5 April, 2016 landlords of furnished residential property were able to claim a ‘wear and tear’ allowance of 10% of the net rental as a deduction for income tax purposes. This has now been abolished and replaced with a like-for-like replacement scheme.
It only applies to long-term rental properties as holiday lets are covered elsewhere using capital allowances. Also, be aware that if you upgrade something like a washing machine to a washer-dryer, you can only claim for the price of a washing machine as a washer dryer is classed as an upgrade.
However, with the replacement of fixtures, for expenditure on items not included as domestic items, it may be possible to claim tax relief on the basis that the expenditure is a repair.
Understanding property repairs and replacements and what you can and cannot claim is a grey area. Essendon Tax can give you expert guidance when trying to decide.