Newbie, house just bought, help please

[herbiecat]

:)We bought a house to let in October last year and it has been empty because we are in the process of doing it up before we can let it.

Do I have to declare my expenses to the tax office even if I did not have any income?

Also, how can I get advice on how to claim back the expenses we are incurring now ? (eg. changing leaking hot water tank, plubing and electrical work, new kitchen - the old one was mouldy and not usable, new windows - surveyor adviced us to change as wood is rotten outside etc.). These are not improvements to the house as such, but necessary works.

Any help and advice is very much appreciated. Thank you!!

[jeffrey]

Did you obtain, before exchanging contracts, a detailed Homebuyers' Survey Report (or similar) re the house's then state of disrepair?

[herbiecat]

Yes, but it did not pick up the problem in the kitchen (fridge leaking for months ruining the back of the cupboards with wet and mould) and the problems with the bogged electrics. Also the hot water tank was leaking slightly (again this wasn't picked up by the survey).

[jeffrey]

Hmm. Apart from your original Q, you might well return to the Surveyor and complain!

[johnjw]

The work you are currently carrying out, is to bring the house up to rentable condition.
I don't think that there is any way for you to claim these expenditures against future rental income.

[Telometer]

Any revenue expenditure - mortgage interest, insurance, gas, electricity, water, regular lawn mowing etc. is deemed to be tax deductible on the day your property business starts - for your purposes probably the day you first let your property.

New kitchens, water tanks, decorating, new windows - indeed pretty much any work whatsoever that has been done by your tradesmen - is capital and is not tax deductible against rental income. Keep a note of it thought and it will reduce your CGT bill when you sell the property.