Which tax year?

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    Which tax year?

    Got myself a bit confused over this one.....

    Just had a boiler replaced in a property I let out. British Gas (through Barclays) have given me two years interest free repayments to pay it off fully over the two year period (total of £4,000). So, the boiler has been installed and I've entered into a contract to pay it off (this all happened in December 2017, so 17/18 tax year).

    Here's the question......can I put the £4,000 down in expenses for the tax year 17/18 even though the money will be leaving my account on a monthly basis for the next two years? I know for a fact that my income will be significantly less (under £10,000 so tax free) during the tax years 18/19 and 19/20 so it would make a lot more sense for me to claim it as an expense in the 17/18 tax year when my income will be about £17,000.

    Hope that makes sense and if anybody has any knowledge or experience of this I'd love to hear it!


    What is the date on their invoice? I think that drives the tax-year. That you have a finance arrangement to pay it is an entirely separate matter.
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...


      The expense was incurred on the invoice date, and the debt is a separate liability.
      It depends on how you complete your accounts.

      If you use the cash basis for your accounts, you account for it as you pay it.
      If you use the accounting basis, you would normally incur the cost on the invoice date, but could (if you do this for other payments) spread the cost over the term of the debt.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).


        I would transfer a sum corresponding to the cost of British Gas bill from your "rental account" to another private account and enter the bill as having been paid in your " rental records". In this way the BG cost is claimed against the 2017/2018 rental income.

        You would repay BG from your private account over the next 2 years.


          £4000! Wow... hope it was gold-plated.


            Thanks very much all, that's a relief that I can offset it against my 17/18 tax. That is, assuming it is an allowable expense.....that's another question so I'll ask about that in a new post!


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