An acceptable level of repairs

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    An acceptable level of repairs

    I recenly engaged a new accountant who questioned the extent to which I was claiming for repairs.She suggested I was claiming too high a proprtion of gross rents.I believe in repairing and redecorating whenever a property falls empty,as it makes the house easier to let,and makes tenants willing to pay a higher figure.What do members think should be spent in percentage terms?

    #2
    Providing you can prove the expenditure with receipts etc, you should be fine. I also decorate where needed between tenants, but I do this myself and mostly just walls, and not normally the full flat. I can't see any issue with employing and paying for a painter decorator which around here for a 2 bed flat will be in the region of 2k. Cuts your profits down a huge amount though if you have a turnover of tenants, maybe a new one each year.

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      #3
      I do all the decoration,but claim for paint etc.I do have receipts and most are evident on my bank statement as most bills settled with debit card or BACS payment.I think the accountant is a bit windy

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        #4
        I would say a reasonable percentage would be low single figures but your accountant's advice might be sound. If your figures stray from the "norm" HMRC computer might say 'investigate'

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          #5
          I have let houses since 1994 and have frequently logged repars such as replacing a roof,without prompting an investigation.My previous accountant,of 15 years standing simply advised me to keep meticulous records.I had a family member at senior level and he said most investigations are the result of "snitching" by envious members of public.I feel that if a property has been left in a distressed condition,which has happened to me twice,it can take thousands to put right,with substantial void periods.

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            #6
            HMRC (and your accountant) can't tell you how to run your business - if you spend a lot on repairs and maintenance, you won't make as much profit, but that's your prerogative.

            As long as the expenditure is solely and exclusively for the business and doesn't increase the capital value of the property materially, it's allowable.

            HMRC say that most of their investigations are triggered by their internal monitoring, but they would say that, wouldn't they?
            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).

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              #7
              I disagree,as repairs and maintenance executed long-term prevent depreciation of assets,and are cheaper than a massive spend after 15-20 years,ensure the houses are lettable and rents can be adjusted ie increased.

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                #8
                You can charge all materials used for repairs and maintenance against the rental income but you cannot for your own labour.

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                  #9
                  i always have a high a proprtion of repairs to gross rents. i indend to sell when i am ready to retire, and i want to keep them up to a good standard. it does not take long for a house to get tired.as an example, all my boilers are on 5 -7year cover, when it comes to the end of warranty i replace them. i find this takes so much hassle out of my life and only works out at £200 a year. i keep very good monthly records, and i am amazed what i have spent at the end of every year!

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                    #10
                    I am glad you share my philosophy,but I would not change boilers after just 7 years.Boilers seem more reliabe these days,and it seems criminal to scrap boilers so prematurely.I think frequent repairs keep tenants sweet,if not they will look elsewhere.

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                      #11
                      Wow, I'm lost for words. Paying someone to remove a perfectly serviceable 5 year old boiler ? What about the environmental impact ?

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                        #12
                        its just a personel choice, but over the years it as removed the biggest hassle in my life, ( 2 days before christmas a boiler goes down, you try getting a plumber or more to the point the part need. on holiday in us it happens) just takes away the only problem i have had renting , and works out cheaper than boiler insurance

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                          #13
                          i bought several electric heaters to serve in emergencies at a cost of £100 and instal electric showers,at cost of £300 a property.

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