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Where Taxpayers and Advisers Meet

Insured damage as expense?

taxisconfusing
Posts:5
Joined:Wed Aug 17, 2016 4:22 pm
Insured damage as expense?

Postby taxisconfusing » Sat Jun 01, 2019 7:55 pm

Hello,

I rent out two rooms two lodgers, and would normally use rent-a-room as this exceeds what I think my expenses would be if I went the more complicated route. However, this year I suffered a very expensive leak. I reclaimed the cost of making this right through my buildings insurance. Now I wonder...is it an expense? Because it alone exceeds the rent-a-room allowance....

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: Insured damage as expense?

Postby maths » Sun Jun 02, 2019 7:51 pm

The insurance premiums is a taxable deduction but insurance recoveries are taxable income.

taxisconfusing
Posts:5
Joined:Wed Aug 17, 2016 4:22 pm

Re: Insured damage as expense?

Postby taxisconfusing » Sun Jun 02, 2019 11:32 pm

Thanks, rent-a-room it is!


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