Allowable Expenses for Landlords: Claiming Part Expenses

Allowable Expenses for Landlords is the term used to refer to all the expenses a landlord is allowed to deduct against their rental profits thus reducing tax payable.  These expenses must be wholly and exclusively incurred in renting out your property but sometimes you may need to pay for something where only part of it relates to your rental property. HMRC sets out rules on how to handle claiming for part expenses.

Claiming Part Expenses

The rule set out by HMRC is that a landlord can claim for part expenses against their taxes is:

Where a definite part or proportion of an expense is incurred wholly and exclusively for the purposes of the property business, you can deduct that part or proportion. 

This means that there needs to be a clear way to define which part of the expense relates to your rental property.

Example of Claiming Part Expenses

You need to replace kitchen tiles in your rental property and buy 12 meters square of tiles for £240.

On fitting you realise that you only needed 10 meters square and decide to use the left over tiles in your own house rather than return them.

Therefore, although the entire bill for tiles is not wholly and exclusively for your rental property we can clearly define which portion relates to your rental property.  Therefore 10 meters square of the price can be treated as an allowable expense of £200 (10/12 x £240).

Example of Claiming Part Expenses

You buy a new hoover for your own home and also use it to clean your rental property on change over of tenants.  There is no clear way to define which part of the hoover cost relates to your rental property so the cost will not be an allowable expense.

Read My Ultimate List of Allowable Expenses for Landlords Here

Anita is a Chartered Accountant, turned blogger and creator of the ever popular free Go Self Employed Email Mini Course, which has been completed by hundreds of attendees all over the UK. Using her 10 years experience in accounting, tax and operations for Small Businesses, Anita is on a mission to make finance simple for the self employed, so they can stop stressing about tax & finances and focus on building profitable businesses which will give them the lifestyle they dream of.