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  • Tax

    Refurb on new property

    Hi

    I am buying a flat to rent out. What costs can I offset for tax purposes please?

    Also it really needs a new bathroom suite fitting - if I do this before the first let, can I offset the cost?

    Many thanks.

    Gozogirl

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    You can offset repairs not improvements

    lets say your currant kitchen has 5 units and you upgrade it with 10 you can claim the 5 excising units as a repair but you would offset the rest as a capital improvement

    It works the same way with electric and gas

    wooden windows can be replaced with UPVC and that's allowable even if they were wood

    You need to take pics before and after for your records

    extensions  and loft conversions are capital expenditure  too

    its quite simple really any thing you add is not a repair


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    Learn Change and Adapt ?????

    DL, many thanks. It only has a shower cubicle at the moment so if I put in a bath with a shower over it, then that will be an addition? I'm thinking it will appeal to more tenants if I put a bath in.

    And what costs from the purchase can be offset for tax?  As in legal fees, stamp duty, searches etc.

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    And don't forget to keep the invoices for the capital expenditure, as these can be deducted from the eventual capital gain if you ever sell the property reducing the CGT you have to pay!

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    If you are buying the property through a LTD company you can offset both repairs and improvements, and avoid S24.

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    No, I'm not doing it through a company.

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    Purely out of interest, how did you come to the decision to buy outside of a Ltd company given the direction the sector is going in ?

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    Partly my age and I only have one other property which I used to live in and it's been rented out for 20 years. The plan is to buy the flat to rent out for a few years and then move into it & sell the family home. At some point I also plan to move into my old property before selling it.

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