UKC

Landlord tax deductible expenses

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 Theho 06 Jan 2022

Hi

I'm a new landlord and about to file my first tax return. I think i've got the idea about most things that can be set against tax (which turns out to be not much) but I'm struggling to find anywhere a definitive answer to this question:

Can I off-set maintenance costs if I did the work myself and how do I go about doing this? Eg: I cleaned out the gutters and also removed a wasp nest (which required some dismantling and rebuilding of some outdoor roofing).

Thanks in advance for any advice.

In reply to Theho:

I claim mileage and materials but don't claim for my time.

If you claim for your time, you are then obliged to declare it as income and that opens up a whole world of pain.

Others may do differently. 

 Ian W 06 Jan 2022
In reply to Presley Whippet:

> I claim mileage and materials but don't claim for my time.

> If you claim for your time, you are then obliged to declare it as income and that opens up a whole world of pain.

> Others may do differently. 

^^This

I do it pretty well the same; its not worth charging your time unless you have enough properties to form a company and pay yourself through that. Just be careful in differetiating between repairs / maintenance and enhancements.

Here's a guide from HMRC; they have also been doing webinars recently on this subject which arent exciting at all but do clarify things.

https://www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

 PaulJepson 06 Jan 2022
In reply to Theho:

You can get your VAT back on a new soul. Of course then you won't want to be a landlord though, so consider it carefully. 

 gethin_allen 07 Jan 2022
In reply to PaulJepson:

Piss off. Not all landlords are bad and being a landlord doesn't necessarily make you evil. There are a lot of people like myself who are reluctant landlords due to circumstances beyond our control. I'm providing someone with a very tidy comfortable property that I've put hundreds of thousands of pounds and thousands of hours of hard work into while I'm in rental accommodation on the other side of the country.

My rental income doesn't go near covering my rent here after agency fees, taxes bills and maintenance. Many of the things that I'm mandated to do go beyond what most home owners do in their own properties when they actually have to pay for them. I'd much rather be in my own home.

 Moacs 07 Jan 2022
In reply to Theho:

There's an option for a blanket £1000 which is often the best route. 

The tax return guidance docum,ent for the rental income section has a pretty useful description if you want to do the detail.

In reply to gethin_allen:

Unfortunately no one ever spreads the word about how good their landlord is but the first time a tennent has a problem they shout it from the highest hill.

Plus there are a lot of slum landlords out there. 

 Maggot 07 Jan 2022
In reply to gethin_allen:

> My rental income doesn't go near covering my rent here after agency fees, taxes bills and maintenance.

So you're complaining that you can't live completely rent free because your tenants aren't paying enough!

 gethin_allen 07 Jan 2022
In reply to Maggot:

> So you're complaining that you can't live completely rent free because your tenants aren't paying enough!

In case you are thinking the bills I am referring to are bills for my current residence I am not. The bills I refer to are landlord insurance, gas certificate, electric installation condition report, boiler servicing, rent smart Wales fees, agency fees because rent smart Wales rules don't allow me to manage the rental of my own property. 

If I were living in my own house I wouldn't be paying most of these and I wouldn't be paying rent because I've paid off the debt on the property.

 Theho 07 Jan 2022
In reply to PaulJepson:

> You can get your VAT back on a new soul. Of course then you won't want to be a landlord though, so consider it carefully. 

I was hoping people ignore this as it's not really helpful for anyone - I see most people have.

Thank you for the help everyone (else)

Post edited at 18:14
 PaulJepson 07 Jan 2022
In reply to Dax H:

> Unfortunately no one ever spreads the word about how good their landlord is

There are no 'good' landlords. They shouldn't exist. We live in a country where people scrape up as much as they can, only for someone who has done nothing other than hold a home hostage to take most of it off them each month. They do the minimum to get their money until the house is no longer financially worth it and then they flog the rotten shell to some first time buyer as a 'do-er-up-er'.

There might be some who look after their house and tenants but since the whole system is morally corrupt, they can get tarred with the same brush. There aren't enough houses for people as it is, so why do they think it's okay to take more?

Who would choose to be a landlord? They are a drain on society. 

 ThunderCat 07 Jan 2022
In reply to PaulJepson:

Mmm... Salted or sweet? 😂  🍿🍿🍿🍿

In reply to PaulJepson:

> Who would choose to be a landlord? 

Most don't, it just happens through change of circumstances. It's often a pain, a chore, stressful even, but often to sell under less than ideal circumstances could cost a person thousands of their hard earned, so they let it out instead. 

Op, as others have said do some rough projections and decide to declare items individually or take the blanket £1k, what works best might vary from year to year. Losses from big expenses roll over, so it can be worth planning ahead or considering timings if you need to spend a large amount. 

Also considering having it valued, if you sell in the future the taxman might chase you for profits on the increase in value when it wasn't your primary residence. 

In reply to PaulJepson:

your so right   I so glad I don’t rent, my house is owned by the mortgage company   Oh boy what scrupulous have they 

 Ian W 07 Jan 2022
In reply to PaulJepson:

> There are no 'good' landlords. They shouldn't exist. We live in a country where people scrape up as much as they can, only for someone who has done nothing other than hold a home hostage to take most of it off them each month. They do the minimum to get their money until the house is no longer financially worth it and then they flog the rotten shell to some first time buyer as a 'do-er-up-er'.

> There might be some who look after their house and tenants but since the whole system is morally corrupt, they can get tarred with the same brush. There aren't enough houses for people as it is, so why do they think it's okay to take more?

> Who would choose to be a landlord? They are a drain on society. 

I'm not completely certain you understand how the housing market works, or where rented property fits into it, and how things have developed to the point where we are today. But thenI would say that, i'm a landlord..........

In reply to PaulJepson:

I'd like to collect my pat on the back from you then because what I did when I had to move and my previous house was on the market with no sign of any offers, was keep it empty. I could have rented it out but didn't want the hassle of being a landlord because after expenses and tax and fees and traveling back and to looking after it it would have brought in approximately cock-all, and yet still would have invited judgement from champagne socialists from all corners of the internet. And it's what they think that would have kept me up at night. Not the thought of what a tenant might be doing to most of my net worth.

It took 18 months to sell. In that time nobody got to live there. That's much better for society, isn't it?

 PaulJepson 07 Jan 2022
In reply to Ian W:

Please enlighten me.

 PaulJepson 07 Jan 2022
In reply to Longsufferingropeholder:

I'm sorry that your house didn't sell quickly but unless you're suggesting that all landlords are just renting their house while they wait for it to sell, I'm not sure how it's relevant? 

In reply to PaulJepson:

Wow that's a big chip on your shoulder. I can understand what you are saying and in areas of cheap housing like where I live property companies swoop in with cash offers on everything that comes on the market taking what would be starter homes away from people who want to buy them to live in.

There is a big difference between those who own multiple properties, sometimes in the hundreds and someone who ended up with a house to rent.

There is also a need for rental property. A lot of people rent because it suits their nomadic lifestyle, moving from area to area every year or so for work or whatever.

What we need to do is keep rental property available but also take back control from the landlord who owns half of the town and I think I have a way to do it.

Remove the ability to evict a tennent as long as they pay their rent on time and look after the property and give them the right to buy at the current market rate after say 2 or 3 years. 

 David Riley 07 Jan 2022
In reply to Dax H:

They can buy any house on the market at the current market rate.  So I'm not sure they'd want to buy the one they're renting ?

 Timmd 07 Jan 2022
In reply to Ian W:

I do reckon there is a place in society for rented and short term accommodation, because it means people can move around the country for work and education (and other).

I think there's probably a morality question mark over rising rents in a setting where there is a housing shortage, and the cost of living is rising faster than earnings, and the deposits for mortgages are high enough that people can't save for them, due to paying rent, as well, If one can afford not to be a private landlord and put another home onto the market for a person to live in, that's probably for the best (or more homes).

Who on UKC is morally good or bad I haven't a clue, and wouldn't like to guess.

Post edited at 23:06
In reply to Dax H:

> Wow that's a big chip on your shoulder. I can understand what you are saying and in areas of cheap housing like where I live property companies swoop in with cash offers on everything that comes on the market taking what would be starter homes away from people who want to buy them to live in.

> There is a big difference between those who own multiple properties, sometimes in the hundreds and someone who ended up with a house to rent.

> There is also a need for rental property. A lot of people rent because it suits their nomadic lifestyle, moving from area to area every year or so for work or whatever.

> What we need to do is keep rental property available but also take back control from the landlord who owns half of the town and I think I have a way to do it.

> Remove the ability to evict a tennent as long as they pay their rent on time and look after the property and give them the right to buy at the current market rate after say 2 or 3 years. 

Give (them) the right to buy. Did you stop to think that this is where it all went wrong?

 Timmd 07 Jan 2022
In reply to Name Changed 34:

IIRC, there was some rule implemented regarding councils abilities to build more council housing, and any money they could allocate for that, at the same time as right-to-buy was, but it's too late at night for remembering more. Essentially it turned the tap off for council housing being provided in the same way as before.

Post edited at 23:33
In reply to Timmd:

Think some cash was diverted to housing association as council could not spend    Note  I (think)

In reply to David Riley:

> They can buy any house on the market at the current market rate.  So I'm not sure they'd want to buy the one they're renting ?

No they can't, cheaper starter homes get snapped up by landlords often at above market rate, the bank won't lend Mr and Mrs Smith £100k to buy a back to back terrace because they value it at £90k but Mr I own 50/500/1000 houses can drop £100k cash on it knowing the extra 10k is only 2 years rent.

Also landlords don't sell houses. On the street we used to live on we were the last people to sell a house, that was in 2014. No house has sold since then. Of the 50 houses on the street only 2 are privately owned.

When we put our house on the market we were approched by multiple property investors that I refused to sell to, I sold it to the young lass over the road who lived with her parents and had saved hard to get a deposit together, it was valued at 80k, I let her have it for just over 70k because that was all she could afford, I was offered the full 80k cash (bank transfer) a few times but I was fortunate to not need the money and it meant more to us to help out a kid from a good family that we had known since she was about 5 years old. 

In reply to Name Changed 34:

> Give (them) the right to buy. Did you stop to think that this is where it all went wrong?

The right to buy council housing was a fantastic idea badly implemented. They were sold at large discounts and the money was not used to build more.

I'm talking about the right to buy privately rented property at a fair government set value to start putting housing back in to the hands of the people who live in them and away from property investor's who are gradually  buying up all of what could be classed as starter homes. 

In reply to Dax H:

A simple solution would be less tax exemptions for those with more than one rented property. Things have changed in recent years, tighter building standards, more tax... but most of it hurts the person letting one house that likely occurred because they moved for employment. It impacts the person letting 10 or 20 properties far less, it's likely their day job and they have time to deal with it. Much higher council tax for vacant property would help too. 

In the Dales, the recent legislation just made some owners switch from permanent tenant to holiday let, which is even worse as most are vacant at least half the year. 

 PaulJepson 08 Jan 2022
In reply to Dax H:

Sorry, couple of stouts down me and particularly jaded having recently been trying to buy a standard northern stock terrace. Didn't help that Windsor House in Portsmouth was in the news and put the anger up me.

I was told constantly that my potential home was a 'good investment opportunity'. The market values were artificially inflated by landlords who had done the absolute bare minimum for 20 years until the houses had got to the point where it wouldn't be legal for them to be let without extensive work, and they STILL expect their big wadge of cash. A majority of what I was viewing were absolutely radged ex-rentals.

People wanting to buy-to-live can't compete with their financial clout and it leaves them in a financial whirlpool where any money they could potentially put towards owning their own home is spent on extortionate rents (which cost more than mortgage repayments). I'm not a first-time-buyer thank God,  and in the current climate I don't think I could be.

Obviously not all people who rent out their property are wankers. If you are a victim of circumstance and are renting somewhere else while you let your owned property out, you're not really the problem. If you own 2, 3, 4 houses, you are. 

In reply to PaulJepson:

House Landlords are part of what is known as rent seeking capitalism. 

Overall It’s not good for the future economic and social well being of the country.

It’s always difficult as a an owner if a property to see yourself in that light.  But cumulative it’s not good for everyone. 

 mik82 08 Jan 2022
In reply to Dax H:

>Also landlords don't sell houses. On the street we used to live on we were the last people to sell a house, that was in 2014. No house has sold since then. Of the 50 houses on the street only 2 are privately owned.

It's definitely an issue as there's a whole wedge of typical first-time buyer properties that have been removed from the market. It isn't just the typical multiple-property investor type though. I know lots of people who kept their first home and let it out rather than selling to move on. I think this was a significant change occurring though the property boom of the 2000s. The new change locally is short term lets displacing even normal lettings. 

I live in quite a desirable area. At present there are are only 6 traditional lets available, of which only one would be affordable to a normal person. 39 properties are for sale - 3 are affordable. There are over 80 short term lets listed on airbnb and most of them are typical first-time buyer homes. This is a huge change from even 5 years ago when there were plenty of suitable houses to rent. 

Post edited at 10:22
In reply to Dax H:

> The right to buy council housing was a fantastic idea badly implemented. They were sold at large discounts and the money was not used to build more.

> I'm talking about the right to buy privately rented property at a fair government set value to start putting housing back in to the hands of the people who live in them and away from property investor's who are gradually  buying up all of what could be classed as starter homes. 

I don’t think I can concur that the right by council housing was a fantastic idea.

 I don’t see this as a vote winner you want to nationalise the private housing stock that is rented and give  Control back to the government that badly implemented a policy of selling it off in the first place albeit different houses    Will you stop at this point or would you propose nationalising all housing stock ?  Cuba did  I was lucky enough to visit before the great leader  and revolutionary passed away It is true  to say I did not see homeless people  so maybe the answers. lets not forget the  disaster of fair rent, and valuations from district valuers regarding compulsory purchases - and right to buy  

 One issue in this geographical location  Are large tracts of Brownfield cleared sites that are earmarked with planning approval for new affordable  homes and are untouched at the same time  as the LPA Local planning authority allows development on greenfield sites as dictated by government  so that it LPA can fulfil its statutory obligation on new housing stock the planning laws need amending urgently to prevent Low value sites staying undeveloped   Moreover a further disgrace within this LPA is to allow a greenfield site of large properties with a guarantee From the developer that affordable homes will be built on the same development  typically the developer will  say funding is not available for the starter homes however they will agree to build them out of the profits of the larger homes Sadly all too often the profits never materialise Neither do the affordable homes

Too lambasted the private rented sector  for the failure of housing policy over the last 40/50 years is a distortion of honesty  and history     It is a market force  that capitalism has  responded to  sub prime mortgages you remember those  All the negative equity the repositions the people who could not get mortgages after they handed the keys back  the Start of generation rent  terraced properties in Manchester for £10,000  or less even  giving rise to a business opportunity and the opportunity to provide a home  for the family that’s  been repossessed    Born out of the greed of Thatchers babies   The self certification mortgage      irrefutably Some people are housed in appalling conditions  by the standards in society  large providers  are Guilty in providing substandard this may be a local council it may be a housing charity it maybe a capitalist   A capitalist With more property to let to with more property to let out.  would it not follow the capitalistWho has one property and therefore all his eggs in one basket will care  well for the property and manage  his tenant well  ?   But you proposes it is a good idea to  possess his property and take the tenant under the wing of a larger organisation we could hand it to Carilion  

 If a property is left in This borough privately Ie not through an estate agent  it has to be registered with the local council and the cost of £500 per annum the local council the providers of good quality homes ( if only they did)

credit For your philanthropic house sale

 RobAJones 08 Jan 2022
In reply to Name Changed 34:

> I don’t think I can concur that the right by council housing was a fantastic idea.

A fantastic idea might be stretching it a bit but I completely agree with Dax's point that the main problem was that affordable social housing virtually stopped being built.

I agree with your observation/concern that brownfield sites haven't been/won't be developed, but isn't this where that affordable social housing should have been built over the last 25 years? 

To me investment properties and second homes are more of an issue than private landlords, and one that can be more easily solved. 

 Bob Kemp 08 Jan 2022
In reply to neilh:

> House Landlords are part of what is known as rent seeking capitalism. 

> Overall It’s not good for the future economic and social well being of the country.

So true. Rent-seeking is an absolute disaster. It’s a key driver of crony capitalism. 
(Worth mentioning that not all landlords are rent-seekers in this sense of course…)

 Ian W 08 Jan 2022
In reply to Theho:

> Hi

> Can I off-set maintenance costs if I did the work myself and how do I go about doing this? Eg: I cleaned out the gutters and also removed a wasp nest (which required some dismantling and rebuilding of some outdoor roofing).

In answer to your actual queries after the thread took a bit of a swerve.....

Both of those activities are allowable against tax, as they are both normal maintenance activities that dont enhance the value of the house, but are required to be done periodically in order to maintain the property in a reasonable condition. The cost doesnt matter; whether a few quid to have gutters cleaned or a couple of thousand to get rid of a wasps nest.

 Misha 11 Jan 2022
In reply to Ian W:

However as someone pointed out above, you would also have to account separately for the income side, so robbing Peter to pay Paul. You can’t just make a charge and get a one sided deduction with no income pick up anywhere.

 GrahamD 11 Jan 2022
In reply to Theho:

Also worth remembering things like electrical and fire safety checks must be done by qualified people. 

 Ian W 11 Jan 2022
In reply to Misha:

> However as someone pointed out above, you would also have to account separately for the income side, so robbing Peter to pay Paul. You can’t just make a charge and get a one sided deduction with no income pick up anywhere.


The income pick up is continued revenue from a habitable property. Ignore maintenance and you have an uninhabitable property with no income.......

In reply to Name Changed 34:

I still think it was a fantastic idea, it gave a lot of people a leg up and the pride of owning their own home rather than renting for life.

Unfortunately the money just got swallowed up rather than re invested. 

In reply to Dax H:

As said further up ( think) some cash went to housing associations   To build stock 

re home for life   The lease holds are short. again I think.   100 years I  shall ask a man who knows next week 

In reply to 

edit as I doze off 

As said further up ( think) some cash went to housing associations   To build stock 

re home for life   The lease holds are short. again I think.   100 years I  shall ask a man who knows next week 

regarding   I still think it was a fantastic idea, it gave a lot of people a leg up and the pride of owning their own home rather than renting for life  

In what way did it give them a leg up ,If they did not sell it is from a housing point little difference they remain in the same home. if they did sell it’s a one time affordable home gone  yes they move on and “up” the property ladder   Some to slide back to rent after the mortgage often self  certified  was pulled  Regarding pride many council tenants were and many are proud of ther homes and oh so many were proud to not only have a home but a new build home post war    was Renting for life  that wrong?  Property ownership is not for all 

was it to give a leg up  ? why did the government sell homes.  .  If it was why not  Insensitive by using the large discount that’s given to by council houses to by  private  Ones?

edit as I doze off 

Post edited at 01:25
 Misha 12 Jan 2022
In reply to Ian W:

I think you’re missing the point. You can’t just make a charge and take a deduction, end of story. You have to account for the equivalent income in your own personal tax return.

The OP didn’t say if the rental is going through a company or an unincorporated business but either way they’d have to put the income from the charge on their personal tax return. That might mean the net benefit is nil. Could even increase the overall tax bill if the deduction is in the company at 19% but the income is subject to income tax at 20% or 45% (or more if they’re a Scottish taxpayer).

The rental income is an entirely separate item.

If it sounds too good to be true, it usually is.

In reply to Name Changed 34:

It gave them a leg up because it took them out of renting for life.

The key part is life, bif you rent you rent for life, you pay every month until you die and all that money goes in to someone else's pocket.

If you buy you pay it off typically over 25 years then you own it. I was mortgage free at 46 years old. Let's say I live to 76. That's £252,000 I'm not paying to someone else based on what my house would cost to rent and that's at todays rent price, I haven't worked out for rent increases. Yes I have to do my own maintenance but that's not even cost to a 1/4 million. 

If I need to I can sell the house to fund a care home of my choice rather than get stuck where they send me or if I don't need to do that I have an asset I can pass on to kids / family / charity or even better if I survive the wife I will probably sell the house to an equity release company and spend my golden years in prostitutes, drugs and holidays. 

Also in the most part people take more pride in a home they own and look after it better and knowing they are working towards something rather than giving money away each month would certainly make me feel better. 

 Ian W 12 Jan 2022
In reply to Misha:

> I think you’re missing the point. You can’t just make a charge and take a deduction, end of story. You have to account for the equivalent income in your own personal tax return.

> The OP didn’t say if the rental is going through a company or an unincorporated business but either way they’d have to put the income from the charge on their personal tax return. That might mean the net benefit is nil. Could even increase the overall tax bill if the deduction is in the company at 19% but the income is subject to income tax at 20% or 45% (or more if they’re a Scottish taxpayer).

> The rental income is an entirely separate item.

> If it sounds too good to be true, it usually is.

It looks like I am! (probably missed some pertinent info before posting).

Declaration of interest; I'm an accountant who derives income from letting residential properties.....

In reply to Dax H:

 Okay you make the argument for homeownership and how it was a leg up  if we can set aside any pros and cons of ownership over  renting  Two 2 unanswered questions remain why the selling of the public housing was a good policy   And how it has benefited the nation in the long term and second why if  Home ownership is good other fiscal stimulus is were not introduced to help with the step up 

Taking the first point of selling off the  public housing stock  it cannot be coincidental: can it? That homelessness has risen and the very debate that is now in place between us is about housing  shortages and the need to rain in the  rogue landlord  

 The right by policy was skewed by the large discounts  that provided an overwhelming incentive to buy    Understanding that the market rate may not of been affordable to the tenant why not Shared ownership   For  properties other than the Public stock of rented housing  for the  tenants wishing to become a home owner 

 It has been said it was a great policy badly implemented nothing good about the policy at all its legacy now shows  this. how was it any better than selling off the healthcare, education  for the user of the  Service 


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