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I wasn't sure what tribe to put this in as its tax related also
I have personally carried out a lot of repairs to my rental properties this tax year, obviously i have receipts for all materials needed etc... I was just wondered if there is anything i can put down for my own time for the repairs as an allowable expense? Also if i bought a tool for a specific repair what would that be classed as?
Also i self manage my properties as my current job gives me the time to do so, can i claim any allowance for managing them myself? As a letting agent would take at least 10%? what about percentage of my phone bill? I only send the odd email/ text message currently would this be enough to claim anything?
Any advice/help on these questions would be greatly appreciated
It seems unfair to some extent, but tax allowances for:
own time on repairs - no
own time on management - no
The HMRC view may be that you have had the advantages of not having to employ a tradesman to complete the work, saving you money at that stage.
Purchase of tools and materials are allowable if used 100% used for business purposes (in this case, repair or management of your BTL portfolio), otherwise - no again. Phones - yes if a reasonable proportion, use of home office - yes, but watch a possible (although probably unlikely) CGT exposure if you claim for a home office and then sell your house.
LL are considered fair game by HMRC (even a pest to be actively hunted and exterminated?). Their new-ish joined up system allow them to match property ownership with mortgage accounts and individuals tax returns, so be warned, it is getting tougher out there!
Managing Director Hamilton Square Estates Ltd
Proprietor Wirral Property Group
Sourcing and renovating investment property since 1994
Thanks for your reply
Yes i was going to claim 10% of my home broadband and 10% of my mobile phone bill. Does 10% seem fair? I only have 2 houses to manage so only the odd phone call here and there to tenants, contractors etc and also in touch with the estate agent.
Regarding use of my home, i think i'm going to opt for the standard rate of £2 a week, i only use it 4/6 hours a month to update my accounts and these works out better for than calculating using my bills etc
Obviously i will go through all this with an accountant once my first year is done but i like to know to myself of what i can claim
Of course you can put down your own time... But that's then additional personal income tax you have to declare, so net sum zero.
May have more merit in a Ltd that employs it's directors to carry out maintenance and management - but have to remember employees and employers NI in addition to income tax.
DISCLAIMER just my personal opinion - for legal advice consult a qualified professional grown-up.
I agree with the answers above - exactly what my accountant told me!
Let’s get this straight
in the eyes of HMRC you are not running a bussiness your running an investment
just like some one day trading on there PC in the liveing room
so you can claim exspences ect but you can’t charge for your time
if your investing via a company different rules but your not
so claim what you can and your reward will be the nett profit after tax
BTL is not self employment
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
No. In the eyes of the HMRC you are running a busness, and running an investment, or maybe neither., depending on which part of the tax law applies. There are at least four different definitions of "business" in the law, one of which only applies to landlords.