How to best expense a maintenance charge spent over 3 years held in escrow

[Chewbacca11]

I own a small portfolio of properties held in my own name (not incorporated nor in partnership). For one of my flats I paid £60k in August 2017 in to an escrow account for maintenance work to replace all double glazing and cladding on the outside of the entire block of flats. The block of flats is large so the maintenance work will take until 2020/21 tax year to complete i.e. the money will be spent by the builder over 3 tax years.

Can I expense the £70k split over the 3 tax years in which the work takes place, which reflects the period of time the funds were spent? Or must the money be expensed this tax year, which is the date the money was transferred in to an escrow account for the work?

I do not have access to the funds held in escrow over the 3 years, only the builder. Any money not spent at the end of the project will be returned to me with interest.

It is more tax efficient for me to spread the expense over 3 years because I will still be able to use my personal allowance for those years (my income less this expense is approx. £11k). If I have to expense the £70k this year, I lose my personal allowance this year, although I will have a loss to roll forwards for the next 2 years. It seems reasonable to spread the expense over the 3 years of the work, but I can't find any info on HRMC website or PIMs to back this up. Thanks.

[bd6759]

I'd account for the expenses as they fell due. That is, account for the expesne as it is released othe conractor.

Are you sure this is revenue and not capital expenditure?

[Chewbacca11]

Putting in double glazing is an expense, not an capital expenditure. The cladding is being replaced as its been in place for 40 years, and the new cladding doesn't enhance the overall aesthetics of the building (its still v ugly!). It is maintenance with some energy efficiencies added in.