Taxation on renovate property

berbatov10

I hope this is the right forum for such a question. I have owned my present property for many years. I am currently renovating it with a new kitchen and windows. In the event I decide to rent it out over what period might HMRC see as 'reasonable' to reclaim such expense, in the event I went on to sell it in a few years?
Thank you

CLAPTON

improvements (not maintenence) can be offset against cgt

berbatov10

I was thinking more a tax deductible expense

[Deleted User]

berbatov10 wrote: »

I was thinking more a tax deductible expense

HMRC will be thinking capital expenditure which increases the value of the house and can only be added to your cost price when calculating your capital gain upon sale.

madgagoo

You're not in a good position to claim any of the renovation costs against any future income. If they were to class as a revenue expense (a repair, with no addition of value) then they would fail the wholly & exclusively test, as you will benefit from them before you start to let the property (duality of purpose).

If they are a capital expense (more likely, as you're probably improving what's there) then the expenditure can be taken into account as a deduction for capital gains tax, when you sell the property.

berbatov10

Guys thanks for the input, this is my main residence I am speaking about so CGT would not be relevant, unless otherwise advised?

CLAPTON

berbatov10 wrote: »

Guys thanks for the input, this is my main residence I am speaking about so CGT would not be relevant, unless otherwise advised?

in the event you rent it out, then cgt become relevant when sold

Darksparkle

berbatov10 wrote: »

Guys thanks for the input, this is my main residence I am speaking about so CGT would not be relevant, unless otherwise advised?

It could be if you rented it out as you mentioned in your OP then sold it.

As currently your main residence, there is no tax relief for renovating your own home.

berbatov10

Thanks Darksparkle hence my question about it being a deductible expense.

Darksparkle

berbatov10 wrote: »

Thanks Darksparkle hence my question about it being a deductible expense.

So the answer is, it isn't. It's your main residence.

berbatov10

It is at this time, but when completed I intend to move in with OH , then becomes a let property