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beancounter
31-12-2010, 13:48 PM
Hi

I own a property in Dorset - Lived there for 5 years before moving to London. At that time I decided to rent it out... rented for about 2 years then when tenant moved out in Aug 09 I decided to try selling it (with view to buying a BTL closer to home). It was on the market for 5 months, but didnt get an acceptable offer so re-let it (new tenant moved in Feb 10). During the 5 months it was on the market I incurred expenses but obviously got no rental income.

My question is, where do I stand on allowable expenses during those 5 months... talking about the mortgage interest, and a few utility bills (inc council tax) that a tenant would have paid during that period. Can I still claim these as expenses to offset with the rents for 0910 tax calculation?

Regards
Neil

Telometer
04-01-2011, 09:58 AM
That's a really good question.

To be deductible, expenses have to be "wholly and exclusively for the purposes of the rental business". So I guess the strict answer is "no" they are not deductible (against anything, sadly) as they were expenses incurred for the purposes of selling your capital asset - but are not deductible against CGT.