claiming for expenses retrospectively

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  • claiming for expenses retrospectively

    I purchased my first buy to let in early March 2011 which was partly financed by a BTL mortgage. I immediately had a new floor laid throughout and had some tiling work done in the bathrooms. It was a new build which came with kitchen appliances as part of the deal. Apart from this I advertised it for rent as an unfurnished flat. My first tenant did not move in until May 2011.

    I have only just notified the IR of my new rental income and this will be the first tax year that I will submit a tax return for. My question is will I be able to include the BTL mortgage arrangement fees and interest incurred during March 2011 as deductibles for this years calculation? If not is there some sort of retrospective way I can get relief for this. I now know that I should have really included these items on a return for the last tax year but I foolishly overlooked this as the rental income hadn’t started to come in at that point.

    I am also not sure if I can include the cost of the flooring / tiling as an expense or would these qualify under the 10% wear and tear rules?

    can anyone help?

  • #2
    HMRC consider a property rental business usually commences on first letting.

    Therefore, you are not yet late as the 2011-12 tax year has not yet ended.

    Pre-trading expenditure is allowable for the previous 7 years.

    http://www.hmrc.gov.uk/manuals/pimmanual/pim2505.htm

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    • #3
      Many thanks King_Maker - thats the pre let financing costs sorted!

      Can anyone tell me if I can use the costs of laying the floor / tiling to reduce my tax bill?

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      • #4
        I'd be inclined to suggest that the tiling/flooring is capital expenditure.

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