Wear and Tear Tax Rules

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    Wear and Tear Tax Rules

    I have recently purchased a furnished holiday home and our first let managed to lose cutlery and break half the crockery. I have now replaced all these items but can these be put on the tax return as expenses and be tax deductible or not? The tax rules are confusing:
    If you replace a domestic item in a property which qualifies as a Furnished Holiday Let, Replacement of Domestic Items relief isn’t available. You will continue to be able to claim capital allowances on these items.
    If not, how should this type of thing be treated?
    Many thanks.

    The people you let to were obviously liable for the breakages/loss of cutlery: Presumably you recovered your loss (or should do so) from deposit so no financial loss incurred. So nothing to claim for. Or have I misunderstood?
    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 tax treatment of replacing items in a holiday let is different, because these items are capital expenditure for that type of business.

      It's not something I've ever done, though, because the entire basis of a tax return for a holiday let is not the same as one for a residential landlord.
      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).


        Send an enquiry to HMRC about your confusing situation and ask how to claim the cost of replacing lost cutlery.


          I have run a Self Contained Holiday Unit ( posh name for Holiday home!) for a few years now.

          I claim all costs for the initial purchase of all furniture, TVs, cups, saucers, kitchen utensils, bedding, all cleaning consumables and cleaning services, as well as any subsequent replacements - basically everything to run the business. You should also be paying Business rates on it, not Council Tax, however as my business is below a threshold, here in Scotland I pay no Business rates.

          Furnished holiday homes are treated differently from normal rentals. "you are entitled to plant and machinery capital allowances for items such as furniture, equipment and fixtures" .


          If unsure, best speak to an accountant. If you use an Agency to rent your property out, also ask them for advice.


            If your tax return form ( for holiday furnished letting ) is SA105 and associated Notes . . You will find the Notes to this form- under box 25 , it directs you to enter the replacement cost of crockery and cutlery in box 36.

            You can google search "hmrc + SA105 Form and Notes" and download the information. . If you still don't understand , get help from a local accounting shop or look online for assistance for completing the first tax return.


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