Setting expenses against profits

[josswallace]

As I understand it I can either go for setting new items off against tax then doing it again on replacement, or I can charge 10% of anual income.

If I go for the 10% option can I still set off agents fees against profits.

[dazalock]

yes, the 10% is for wear and tear of furnishings not professional fees.

[Tax Accountant]

As I understand it I can either go for setting new items off against tax then doing it again on replacement, or I can charge 10% of anual income.

If I go for the 10% option can I still set off agents fees against profits.

You cannot claim new furnishings items against tax. It is either the replacement costs when you renew these items or the simpler and better alternative of claiming 10% of Gross Rental Income as wear & tear allowance. This is allowed each and every year regardless of whether or not you have replaced any furnishings that year. therefore, in a furnished accommodation, you would not claim any expense of furnishings or replacement thereof, but instead you would claim wear & tear allowance every year in the sum equal to 10% of gross Rents in each year. For example, if your rental income is £10,000 per year, you would claim wear & tear allowance of £1,000 every year.

Please note that you are still able to claim all your other normal expenses as usual, eg, insurances, repairs, agents fees etc.

Additionally, some items which are not considered to be furnishings, are also allowable as renewals, eg boiler replacement, windows replacement etc.

Ramnik

[dazalock]

Ramnik

Would that include, for example, a new fitted kitchen? i.e. the units are fitted along with the oven and hob, therefore are not furnishings and would be deemed to be part of the fabric of the house?

Regards

[Tax Accountant]

''Additionally, some items which are not considered to be furnishings, are also allowable as renewals, eg boiler replacement, windows replacement etc.''
Ramnik

Would that include, for example, a new fitted kitchen? i.e. the units are fitted along with the oven and hob, therefore are not furnishings and would be deemed to be part of the fabric of the house?
Regards
Dazalock

Hi Dazalock

I was dreading someone asking this question one of these days. I have not researched this and am therefore holding back from replying definitively. I am not too sure if they could be considered to be part of the fabric of the house as you state.