Allowance against rent of wear and tear

[Wakefield]

The landlord is allowed 10% wear and tear, which is described further on the Guide to the Short Tax Return as "10% of the net rents ... What does it mean by "net rents". In one of the answers given on your site it gives the example of water rates paid by the tenant. Are the expenses paid by the landlord included, eg estate agent fees, mortgage interest, etc. also to be deducted to get the "net rent". Are these deducted from the rent to give the net rent on which the 10% wear and tear is calculated?

[Graham1]

NET i.e if u include (pay) water rates etc in rental u must deduct these.

Get a copy of IR150 Free from revenue order on website

[Wakefield]

Thanks, and sorry to be so pedantic, but do you mean that all the other expenses that the landlord has to pay, eg agent's fees, mortgage interest, etc. are not deducted to get the net rent for the purposes of the "10% calculation of net rent" for wear and tear?

[Graham1]

No.

I'll give u an example of my situation: My tennant (lives in my new flat and water useage is divided between OWNERS and calculated as a sq ft percentage (say 19.50 per month, this is added to my Service Charge that I pay)therefore to reinburse me the tennant adds £19.50 to monthly rent.. I get £819.50 monthly however I cannot include the £19.50 (x12 for year) in the 10% Wear and Tear calculation.

The 819.50 is the GROSS and 800.00 is THE NET

So If one lets a property that includes utilities, rates, car, etc one must reduce the 'value' of these from the rent to establish the NET amount.

Good Luck

Graham

[Wakefield]

I get it! Thanks a lot Graham !