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First Self Assessment for Property. None completed

Started by buildtrade, December 04, 2023, 02:44:03 PM

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Scenario. First BTL property purchased jointly by husband and wife Nov 2021. First Tenant in Feb 2022. No property self assessment was registered in 2021/2022 as total joint revenue only £1,100 (2 mths*£550). Now they are completing the first property self assessment for 2022/2023. My understanding is they can include property investment pre-trading expenditure as deductions for up to seven years. My perception is eligible expenses include Tenant find and letting agent management fee, management service fee, Landlord registration, insurance, rates and fittings replacement like for like. Example expenditure not allowed as deductions are new furniture, fittings, survey fees, SDLT and property purchase fee costs. My question how should pre-trading allowances be recorded? If they are netted off against the income of £1,100 it is a loss of -£600 for 2021/2022. Should this be recorded in the box "Loss brought forward used against this years profits"... or treated in another way?


If they wanted to claim the pre-trading expenses, both people needed to have completed a 21/22 return (having confirmed the new source of income to HMRC who would have confirmed how this was to be done). That return would show the loss, which can then be carried forward into this year's return.

You can't just bring forward an unreported loss.

By using the tax free allowance in 21/22 the couple have forgone the expenses claim. You can't "claim" the £1000 tax free income and allowable costs in the same tax year.