Cladding Bills, BSF and Property Income Expenses

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Cladding Bills, BSF and Property Income Expenses

    Hi everyone,
    was preparing my property income self assessment for tax year ending April 2021 and needing help in understanding the expense related to cladding bills. So as we all know, all leaseholders facing cladding issue have now been received the extortionate bills related to cladding remediation. As part of my service charge invoice which was due 1 April 2021, the building management has put two separate charges, one related to overall service charge around 2,500 pounds and one related to cladding remediation of around 15,500 pounds for the half yearly April -Sept 2021 period. Building management sent along separate letter stating that the 15,500 bills are not enforceable since the BSF application is still currently underway (we still have not received application decision). I know that HMRC self assessment should state only expenses that are already paid for during the reported tax year, but interested to know what are the other leaseholders here have prepared for their tax returns? I suppose I should exclude the 15,500 bills from the expense and only put the 2,500 that i have already paid for before 1 April 2021.

    Any thoughts and comments are appreciated.

    #2
    If you have been billed 15500 for payment on 1 April 2021 ( and still not yet paid) , you can still include the bill as an expense under 2020-2021 because the tax year ends on 5th April 2021.

    Comment


      #3
      Thanks for your response Gordon999.

      i have been using cash basis (not traditional/accrual basis) when submitting self assessment in the past. According to HMRC guidelines, with cash basis you can only count the expenses you’ve actually paid (anything you owe isn’t counted until you pay it) - meaning if i continue to use cash basis on my income tax then i wouldn't be able to include the cladding remediation expenses until i actually paid it?

      Comment


        #4
        I suggest you could include the bill for £15500 in 2020-2021 and state in blank page that "expenses include £15,500 for cladding repairs and payment was due on 1 April 2021 , but not yet paid".

        Comment

        Latest Activity

        Collapse

        • HPI out-pacing PRR accumulation
          by lllccc
          I wondered if anyone else has been in this situation and what would you do about it? I now only own the one property (and live in it), but due to substantial renovation period before moving in the CGT will only increase now (assuming HPI increasing at 3.6% which is not unreasonable). I didn't understand...
          04-12-2021, 14:20 PM
        • Reply to HPI out-pacing PRR accumulation
          by lllccc
          Hi Gordon, unfortunately it was not, hence the question.
          04-12-2021, 16:07 PM
        • Reply to HPI out-pacing PRR accumulation
          by Gordon999
          If the property has been your "main residence" since purchase, there is no tax on capital gain .
          04-12-2021, 14:40 PM
        • Will they raise taxes again?
          by JK0
          My accountant just finished my 2020/21 tax return, and my income is half of the previous year. I did not think it would be quite that bad. (Half my tenants moved out, and I had a job to replace them. Plus had to get fourteen EICR's!)

          I'm guessing you guys are in a similar boat. Never mind...
          27-11-2021, 20:20 PM
        • Reply to Will they raise taxes again?
          by Gordon999
          The Daily Mail reported on 29 Oct 2021 the 1.25 p increase for social care levy commencing in 2022 , will take £16 Bil from our pockets. The freezing of personal allowance for income tax at £12570 until 2026 will take £19 Bill by 2025/2026.
          ...
          02-12-2021, 11:18 AM
        • Reply to Will they raise taxes again?
          by Gordon999
          Corporation tax for large companies ( over £250K profit ) will be raised from 19% to 25% rate commencing from April 2023.
          30-11-2021, 21:35 PM
        • Reply to Corporation Tax
          by Gordon999
          There seems to be 2 problems ( I am not an accountant ) :

          (1.) The company has to pay £30,000 tax due to revaluation of property asset increased higher by £150,000 ( estimated). Does it have the cash in its bank account to pay ?

          ( 2) husband owns one third interest of property...
          30-11-2021, 14:09 PM
        • Reply to Will they raise taxes again?
          by theartfullodger
          Taxes bound to go up, huge amounts to pay for Covid & BR*X*it. Death & taxes, death & taxes.

          Holding off working out my position, wishing to remain cheerful for Christmas.

          Best wishes to all...
          28-11-2021, 10:45 AM
        • Reply to Will they raise taxes again?
          by Neelix
          ^^ please don’t take this the wrong way but £10 k down on what turnover or number of properties?

          i’ve done a lot of EICRs and remedial work over the last 18 months and a lot of it was because properties hadn’t been inspected and some were just dangerous....
          28-11-2021, 10:29 AM
        • Reply to Will they raise taxes again?
          by jpkeates
          I'm about £10k down and it's mostly electrical work.

          I can't see this government putting up taxes anymore before the next election, although there's nothing to say that they won't figure out how to tax landlords more specifically - there's few votes lost there.

          My candidate...
          28-11-2021, 10:07 AM
        Working...
        X