Can I claim these costs ?

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    Can I claim these costs ?

    Hi All,

    I would like to know which of the following costs I can claim back as expenses.

    1) The flat is being leased out but in order to carry on with the lease, I have been told to resolve electrical problems in the house. I opted to partly rewire the flat as the cost of a full rewire was prohibitive. So In short, all the defects raised by the council who lease the property were fixed. I always buy the materials as I can then have a receipt and then pay for labour only.

    2) Gas service engineer who is a mate, he comes in to issue a gas certificate.

    3) Major works as in a section 20 came in for the said property, when it was bought there were no notices of a pending section 20, so it didnt affect anything on the purchase price. Will I be able to claim this. The cost was around £5k. I also understand section 20 notices have to come under specific year when it was raised. Also if its a capital expense, what about interest as I dont intend to sell for the next 20 years.

    4) Management fee, I manage the property myself and although I incurr costs such as cost of petrol to drive there to sort out issues, phone calls and of course my time as well as lost income from having to deal with issues etc. Do they all fall into a flat 10% of gross rent fee or can one apportion seperately ? It will start to get messy picking out the individual costs of specific phone calls etc.

    Thanks in advance.

    1. yes`
    2. yes
    3. If any part of the sum represented an improvement then that would be a capital expense and deductible when you sold the property. If it was a repair to existing fixtures, buildings etc, then this is a revenue expense and deductible from rental income. The fact that you say that it did not affect the purchase price would suggest that it is not an improvement. Look at the Odeon Cinema case and the Law Shipping case. See if your property is a cinema or a ship.
    If it is capital then there is no allowance for interest. I am assuming you mean a notional interest on the improvement, if any. If you borrowed money to finance the repairs, then that interest is allowable.
    4. You cannot normally charge for your own labour, and the 10% wear and tear does not include general running around. Keep a note of how many miles you incur running around. In terms of phone calls, this would come under use of home as office. It would include things like part of your desk, computer, study, phone calls, stationary etc etc.


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