SMF - Just Installed!


Started by raysal, November 20, 2023, 08:10:18 AM

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Good morning
               Could anyone tell me if you can claim for upkeep and repairs when letting a property please.  As a example if I have to put in a new bathroom, can I claim that against the rental income or is it just classed as a non claimable as it's a asset.
any help appreciated thanks


You should probably get a decent book on property investment and tax (the cost of the book is an allowable expense). The idea that a cost might be "non-claimable" because it's an asset is misplaced.

There are two types of allowable costs, operational (revenue), which are allowable against income for tax purposes, and capital, which are allowable against Capital Gains Tax on disposal.

If the bathroom is a new room (there wasn't a bathroom before) or is a huge upgrade and materially increases the value of the property, it's a capital expense. If it's simply a replacement of what was there before, it's an operational cost.

HMRC accept that a replacement bathroom is likely to be nicer than what was there before, because newer modern things are generally nicer than what they replace, so there's likely to be some value added as a side effect.

If the old bathroom was a pokey old mess and the replacement has a wet room, sauna and looks amazing, it's gone beyond that, so it's probably a mix of the two and should be treated as a split between the two. Most replacement bathrooms fall into this category.