Accounts for chalet rental

DoubleVodka

Hi - please can someone help?! With some friends, we co-own a holiday chalet which we rent out.

We purchased the chalet last year - do we include the actual purchase price of the chalet in our self-assessment return?

Also, for the purpose of self-assessment, when you begin accounts for a new tax year, do you carry forward the final balance from the previous year, or do you start at zero?

Any advice would be appreciated - thank you!

Pennywise

No, initial costs are capital and are set against future sale for capital gains tax. You don't put them on your SA return.

The tax year is fixed 6/4/x0 to 5/4/x1. Each year stands alone. If you make a loss in a year, you can carry it forward to the next year.

I'm assuming the property is in the UK and that you and your friends are all UK resident. Different rules may apply if there is an international aspect.

I'd suggest you get an accountant sooner rather than later. Not all expenses will be allowable so you need to know what is and what isn't and also need some idea of your likely tax liabilities to help you budget.

DoubleVodka

Thanks Pennywise - I assumed correctly! Many thanks for your advice