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Where Taxpayers and Advisers Meet

Landlord pre letting expenses and domestic item replacement

Joined:Sun Jul 23, 2023 8:28 pm
Landlord pre letting expenses and domestic item replacement

Postby newfoundglory » Sun Jul 23, 2023 11:46 pm

I have about 4 years of pre letting expenses. Property was inherited through probate, so not an investment purchase, was occupied up until that point but it took a long time to decorate and replace worn items (Covid during that period, but property was empty). This is not work that had to be done, as it could have been let as it was as it was unoccupied up until the passing.... It doesn't seem any work has actually likely added any real value to the property.

I think what i need to understand is the difference between pre-letting expenses and those which are domestic item replacements (and if that can apply here)

Specifically, the wording related to domestic item replacement which includes when you first exploit the land/property for profit. Whether that is when it is first let, or when first marketed for rent by an estate agency for rent, or simply when you first decide it will be rental, which can seem more logical than when the letting business typically commences.

The following were expenses incurred before the letting was agreed and started:

Council tax, utilities/energy bills, empty buildings insurance and all decorating items (paint) - all Revenue expense
Electrical work to replace old sockets with modern looking ones - revenue expense
Replacing several old/worn radiators - revenue expense
Replacement smoke/CO alarms (if already present) - revenue expense
Replacement of anything broken like door knobs and locks, curtain or clothes poles - revenue expense

Unsure of these items on my list, for revenue purposes, before letting commences, can you help:

New consumer unit (had physical fuses, so maybe maintenance/repairs, but also needed for the EICR)

Replacement kitchen units/sink of lesser quality but same layout + flooring and some tiles.

Replacement carpet/underlay + cost of fitting

Costs of a handyman to do carpentry, fittings and repairs of things

Replacing an existing gas cooker which was present + cost of install (after marketed for rent, deposit given, but potential tenants pulled out)

Cost of a cheap pressure washer

Cost of a black and white laser printer (which cannot print photos)

British gas homecare for landlords

Replace incandescent light bulbs with LEDs, kitchen/bathroom lights with LED equivalents.

Cheap wall decor, frames for marketing

Joined:Sat Feb 01, 2014 3:26 pm

Re: Landlord pre letting expenses and domestic item replacement

Postby bd6759 » Mon Jul 24, 2023 4:05 pm

I had no difficulty with most of those expenses. They are incurred within 7 years of letting commencing, so are treated as being incurred on the day letting commences.

I have doubts with the pressure washer and printer. Wholly allowable only if used exclusively (solely) in connection with the letting. They will probably have non-business use as well, so perhaps an apportionment in needed.

Unless you have an existing property business, your property business starts when the property is first let.

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