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neilanglim
23-01-2012, 10:45 AM
Hi,

I am filling out a tax return for a rental property for the first time and would like to claim an expense for what I feel is maintance (therefore can be deducted from rental income) but it may be a capital expense........I hope someone can help me?

I used to live in the house but had to move so rented it out. The house has solid walls. When I lived there, there was a slight problem with condensation but we kept the place ventillated and heated and cleaned any slight mould on the walls.

Since tennants moved in, they do not ventillate or heat the house adequately and the condesation on the walls got so bad that the mould grew quickly and the paint peeled off and was causing damage to the plasterwork.

To rectify this I got a condensation man to have a look and he suggested some vents and to get internal wall insulation on one of the walls to improve the condensation problem. This has been done for a total cost of £2820.

Can this £2820 be expense be set against the rental income?? Or is it a capital expense? I feel the work was required to prevent ongoing deterioration of the property due to condensation/damp therefore feel its a maintance issue.

I dont feel that having the work done has improved the value of the property, just brought it to an acceptable standard.

Any help on the subject would be greatly appreciated.

Neil

JK0
23-01-2012, 11:06 AM
I think I read somewhere that insulation is an allowable income deduction. Maybe wait for someone else to confirm.

edit. I just found this:

http://www.hmrc.gov.uk/manuals/pimmanual/pim2072.htm

neilanglim
23-01-2012, 13:49 PM
Thanks for your post. The LESA only allows £1500 for the wall insulation. Unfortunately I dont have a breakdown of what was the cost for the actual insulation and for the vents/extractor fans. The total was £2820.

The thing about this expense, I didnt do it to improve the energy efficiency as such but it was to treat a bad condensation problem which I couldnt leave as the tennants wanted to leave and it was affecting their health........thats why I was hoping to claim the whole amout against the income rather than capital gain.

Having not done a property tax form before is it possible to phone HMRC and ask for their verdict on it directly??? (does anyone have a number?)

Neil

Gordon999
23-01-2012, 13:59 PM
See Notes on SA105 which is the tax form for declaring annual property income and look at notes for box 23 and box 33 .

http://www.hmrc.gov.uk/worksheets/sa105-notes.pdf