URGENT Property expenses/rent question self-assessment

Chichi_2

Called HMRC been told I need to wait up to 7 working days for a technical adviser to answer my questions. Can any MSERs help as I'd like to get self-assessment out of the way:

March 2007: Rental property purchased March 2007
Some furniture etc bought before 6 April 2007(in March)

2007-2008: Completed first tax return for this property but didn't include expenses incurred before April 2007.

2008-9 : Doing self-assessment now and seen receipts for expenses dated March 2007. If I didn't include these in 07-08 assessment, when can I?

Also if my tenants pay rent in advance and their rent date is say 24th of each month. If they paid on 24th March they have effectively paid for a period which goes past 5 April. Do I calculate the rental income up to 5th April or ignore the whole payment and include in next year's return? Many thanks. If I've not made myself clear feel free to tell me.

anselld

Chichi wrote: »

Called HMRC been told I need to wait up to 7 working days for a technical adviser to answer my questions. Can any MSERs help as I'd like to get self-assessment out of the way:

March 2007: Rental property purchased March 2007
Some furniture etc bought before 6 April 2007(in March)

2007-2008: Completed first tax return for this property but didn't include expenses incurred before April 2007.

2008-9 : Doing self-assessment now and seen receipts for expenses dated March 2007. If I didn't include these in 07-08 assessment, when can I?

Also if my tenants pay rent in advance and their rent date is say 24th of each month. If they paid on 24th March they have effectively paid for a period which goes past 5 April. Do I calculate the rental income up to 5th April or ignore the whole payment and include in next year's return? Many thanks. If I've not made myself clear feel free to tell me.

I would think it depends if this is you only (first) property. Letting business is deemed to start on the first let, so unless you already had rental income prior to the March purchase the pre-let expenses will be allowable on the date first let (presumably 07-08). You have until 31 Jan 2010 to make an amendment to your 07-08 return. BTW you mention furniture, but that is not an allowable expense.

The second question - normally you would apportion the income across the two years. You can use cash-basis accounting if income from all properties is less than 15,000, but you must be consistent so presumably you will do the same as you did on the 07-08 return.

fengirl_2

if the property is let furninshed, you should be claiming a 10% wear and tear allowance against the rental income. If you have not done that for 07/08, then you can amend that years return.

fubar4164

Just to make the point clear here:

You can't claim for capital costs, so furnishing the flat from scratch is not an allowable deduction, but the cost of repairing the furniture is allowable. Also, you can't claim for repairs on furniture and also claim 10% W&T, you need to pick 1 or the other and stick with it.