Rental Property Expense Deductions

Helpme999

Really confused. Any advice would be greatly appreciated.
Property rented out and not sure which deductions can be made. I have read PIM3200 and PIM2020 and have been left confused.
Property is not fully furnished. It has all the white goods (free-standing washing machine, fridge freezer, tumble dryer, dishwasher,wardrobes, cooker, hoover, curtains, blinds etc), there are no beds or sofas as the tenants had their own.

1.I assume then the 10% deduction can not be claimed. Or can it?
2. If the renewals method is used, can we deduct the cost of buying the white goods as they were bought specific for the rental.

Hope I am making sense! Help xx

jimmo

Let me turn your question on its head.

Are you letting the property furnished or unfurnished?

My son and his partner rent a furnished property but choose to use their own bed, freezer and a few other bits. Taking the bed as an example, they chose to use their own but their landlord would have provided one if needed. Therefore the landlord provides a fully furnished house but, as a service to his tenants, he doesn’t insist that his bed is actually in the property.

The landlord therefore lets a furnished property and the tax consequences follow.

So, what about you? Do you let furnished and allow your tenants to use their own furniture or have you negotiated a specific deal resulting in your tenants paying more than the going rate for an unfurnished

Helpme999

Hi Jimmo, many thanks for taking the time to reply. The tenants had their own sofa and beds so we didn't provide those as they didn't need them. If pushed, we would have got them. So I guess you are saying the property is furnished so we can claim the 10% right?
Can we claim for the purchase of the White goods? Sorry I know the questions sound daft! X

00ec25

No you cannot claim the purchase costs of the white goods.

This is what the W&T allowance is designed to cover, in accountancy speak you get an annual "depreciation" sum, ie each year you get back a bit of money which goes towards their eventual replacement. If you were allowed to claim their original cost then you would end up double counting

Helpme999

Hi thanks for your reply. So let me see if I understand this correctly...say as an example might help me :

Rent 12000
Less Expenses
Estate Agent 1200
Repairs to Roof 800
Toilet Repair 50
Bathroom Fan Replaced 100
Wear & Tear 1200
Total Expenses are 3350

Profit 8650

The new washing machine, other white goods say £1000. Do I get say 25% of £1000 as a deduction against the profit? Or is that taken account in the wear and tear allowance?

Thank you

Helpme999

Anyone? Xx

John_Pierpoint

My practical knowledge of rental income is very limited but here is the instruction the tax man on how to approach your figures.

http://www.hmrc.gov.uk/manuals/pimmanual/pim3200.htm

I think I might be muttering "betterment" over the roof "repair", were I a tax man looking at his; personally I would take a quick look on Street View to keep an eye on you but perhaps the sort of people being recruited these days are not allowed to take any initiative in their jobs?.

How and when did you acquire the property ?

There are "landlord" forums where such niceties are debated.
http://www.telegraph.co.uk/property/property-club/10232949/landlord-property-tax-advice.html

Helpme999

Thank you x

pinklady21

Helpme999 wrote: »

Hi thanks for your reply. So let me see if I understand this correctly...say as an example might help me :

Rent 12000
Less Expenses
Estate Agent 1200
Repairs to Roof 800
Toilet Repair 50
Bathroom Fan Replaced 100
Wear & Tear 1200
Total Expenses are 3350

Profit 8650

The new washing machine, other white goods say £1000. Do I get say 25% of £1000 as a deduction against the profit? Or is that taken account in the wear and tear allowance?

Thank you

No - I think the 10% is deducted from the rental income figure. ie £1200
Suggest check with an accountant, or HMRC if you can get thru on the phone that is!

anselld

Helpme999 wrote: »

The new washing machine, other white goods say £1000. Do I get say 25% of £1000 as a deduction against the profit?

As 00ec25 has stated you cannot claim for the white goods (no matter how many times you ask the question).
If you are claiming W&T then they are included in this.
If you are claiming renewal basis then you can claim for replacements but not the initial cost of providing in the first place.

Helpme999

Thank you. It's much clearer x