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When letting residential property, it’s important to know if you will qualify for tax deductions when repairing or replacing furniture and fittings inside the building. When maintaining the outside or communal areas (in buildings with multiple dwellings), you can always claim back the tax costs.

When fitting something for the first time – such as a bathroom suite – the tax cost is included in the capital cost of the building and can only be claimed back when the property is sold. If you repair or replace the fitting to the same standard, the taxman views it as a ‘repair’ and the cost is deductible from the rental income.

If you replace a fitting to a higher quality, then the whole cost is treated as a capital improvement and is only deductible when selling the property. However, if replacing a fitting with something of higher quality due only to it being the modern equivalent of an outdated item, then it’ll be classed as a ‘tax deductible repair’. For example, installing a more energy efficient boiler in place of an old central heating system would be viewed as a repair, not an improvement.

If you’d like to discuss your let property claims with us, or have any queries at all, do please get in touch with us on 01782 279615.


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