Tax Changes on Wear and Tear Allowance
As from April 2016 the government will replace the 10% wear and tear allowance with a new relief that allows all residential landlords to deduct the actual costs of replacing furnishings, (the only exception to this will be for landlords of furnished holiday lets)
This new relief will apply to all rental properties, fully furnished, furnished, part furnished and unfurnished.
At the moment there is no allowance at all available for unfurnished and part furnished lets since this allowance was removed in April 2013.
An informative list of what will or won’t be deductable has not yet been published. It therefore remains imperative that receipts are kept for all works on a landlord’s property.
Castle Estates will show all repairs, maintenance and replacements on the monthly statement with an attached receipt.
These should be kept for your accountant or any tax questionnaire or annual return.
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