Plaster Skimming - Repair or Improvement?

ck_uk

If extensive skimming work is required to an old property whose plaster is in poor condition, would this seen by HMRC as a repair (and therefore not claimable when calculating CGT), or would it be considered an improvement?

booksurr

it cannot be anything other than a repair as by your own admission there was plaster there before and you are simply reinstating it to its former condition.

You are not adding something new or improved

however, it does also depend on the context of the property:
- second home?
- property purchased in order to refurbish and sell on?
- BTL?

ck_uk

Thanks booksurr, at the moment it's intended as a refurb project.

anselld

ck_uk wrote: »

Thanks booksurr, at the moment it's intended as a refurb project.

If this is a dilapidated property and the plastering is part of overall refurb to bring the property up to a let-able state then is will be classified as capital (improvement).

AdrianC

If the old plaster is in that poor condition, do you really want to just skim? All that'll do is give a cosmetic facelift - you'll still have the problem of old, crumbling, blown plaster.

silvercar

booksurr wrote: »

it cannot be anything other than a repair as by your own admission there was plaster there before and you are simply reinstating it to its former condition.

You are not adding something new or improved

however, it does also depend on the context of the property:
- second home?
- property purchased in order to refurbish and sell on?
- BTL?

anselld wrote: »

If this is a dilapidated property and the plastering is part of overall refurb to bring the property up to a let-able state then is will be classified as capital (improvement).

Sorry to crash in. I'm also interested in the answer to this. Property was a student BTL, I'm now refurbing to a higher standard. Was intending on skimming the plaster in placces, but investigation found it had blown in so many places, we are replastering. I thought I would have to break down the costs between that which is refurb and what is capital, but ansell seems to suggest it is all capital?

silvercar

AdrianC wrote: »

If the old plaster is in that poor condition, do you really want to just skim? All that'll do is give a cosmetic facelift - you'll still have the problem of old, crumbling, blown plaster.

Agree with this. In removing part of a ceiling, the poor condition plaster on the walls started falling off. Had I skimmed the plaster it would have been a waste of time and money, far better to replace while the place is a dusty project than to have to do it later.

anselld

silvercar wrote: »

Sorry to crash in. I'm also interested in the answer to this. Property was a student BTL, I'm now refurbing to a higher standard. Was intending on skimming the plaster in placces, but investigation found it had blown in so many places, we are replastering. I thought I would have to break down the costs between that which is refurb and what is capital, but ansell seems to suggest it is all capital?

I said *if it was dilapidated* and *if the work was required for it to be lettable*.

It can be argued either way based on a number of factors, see ..
http://www.hmrc.gov.uk/manuals/bimmanual/bim46935.htm

ck_uk

With AdrianC I totally agree. Removing the old wallpaper has evidenced this. The plasterwork (the epidermis layer, if you will) is in TATTERS in several places. It has fallen away quite easily from the browning (which appears to be solid). HMRC will make of it what they will. A plasterer will be commissioned to adorn the walls with his or her artistry. As for the ceilings, lath & plaster.. let's not go there..

booksurr

ck_uk wrote: »

Thanks booksurr, at the moment it's intended as a refurb project.

what comes after the refurb? If the intention behind the purchase is to....

- refurb and sell on, you will be subject to income tax on everything, not CGT as you are undertaking property trading

- place the property into a rental business then the plastering would be an allowable cost against your income tax, as it is a business asset not an investment

- hold as a second home then it will form part of the capital cost as referenced by anselld and will be subject to CGT when you finally sell up as it is an investment asset

anselld wrote: »

If this is a dilapidated property and the plastering is part of overall refurb to bring the property up to a let-able state then is will be classified as capital (improvement).

if the purpose is to let the property then most LL would prefer to go down the income tax route rather than claim as capital

AdrianC

ck_uk wrote: »

As for the ceilings, lath & plaster.. let's not go there..

If you don't go there now, it's not going to get any better over time... If there's a plasterer coming in anyway, why NOT do it now? Give him five sides to skim instead of just four.

Ripping down the old ceiling isn't that horrific a job if the room's empty and the place is going to be dusty anyway. Then some new p'board, and job's a good 'un.