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Furnished Holiday Let - Allowable Expenses and categorisation

22/01/2018 12:37:38
We have 2 furnished holiday lets in the UK with a combined income of around £53,0000 (so under £83,000) and total expenses (including capital allowances) are around £50,000 (exact figure to be finalised).
Can I just check my understanding of the reading of the UK Property Notes and the Claim Capital Allowances Notes
1) All expenses and capital items (as per capital allowances) should be put into Box 9, rather than compleing each separate box 6 -12 on the UK Property Form.
2) I do my return on a 'cash basis', so categories income/expenses/capital items all in the period they were received/purchased.
3) Items bought, such as a replacement sofa to replace a damaged sofa are claimable as a capital allowance and we can claim the full cost of such items against profit in the year it was purchase, as part of the Annual Investment Allowance (since the items we will be claiming are well under the £200,000 Annual Investment Allowance). However, since our income is less than £83,000 such items should just be included in Box 9, along with other expenses.

Thank you

This message was edited 1 time. Last update was at 22/01/2018 13:05:16

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Re:Furnished Holiday Let - Allowable Expenses and categorisation

22/01/2018 13:57:27
Hi,

If the Furnished Holiday Let income before expenses is below £83000 then you will add up all the expenses and put the total in box 9 of the SA105. You will enter the Capital Allowances in box 12. of the SA105

Please refer to the following links https://www.gov.uk/government/publications/furnished-holiday-lettings-hs253-self-assessment-helpsheet

https://www.gov.uk/capital-allowances

https://www.gov.uk/hmrc-internal-manuals/property-income-manual/pim3040

Kind regards
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Re:Furnished Holiday Let - Allowable Expenses and categorisation

23/01/2018 01:40:38
1) If we are to split out capital items. Please could you clarify whether the items below (which replace existing broken or damaged items) are capital or expenses
a) Replacement Sofa
b) Replacement Vacuum cleaner
c) Replacement Garden Chairs
d) Replacement pans/crockery and cutlery

2) For those items which are capital can we claim the full amount under the annual investment allowance

Thank you

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Re:Furnished Holiday Let - Allowable Expenses and categorisation

23/01/2018 10:11:02
Hi

Is the enquiry in relation to a Residential Letting or a Furnished Holiday Let?

As I am not aware of the full facts please refer to the following links;

https://www.gov.uk/guidance/income-tax-when-you-rent-out-a-property-working-out-your-rental-income

https://www.gov.uk/government/publications/furnished-holiday-lettings-hs253-self-assessment-helpsheet/hs253-furnished-holiday-lettings-2015

If it is a Residential Letting then you will be able to claim Replacement Domestic Items Relief. If a Furnished Holiday Let then you can claim Capital Allowances.
Kind regards

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