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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15914
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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what is considered fully furnished landlord to claim

Customer Question

what is considered fully furnished landlord to claim wear and tear allowance and if property is only part furnished can claims be made . If I have different properties one furnished flats and one part furnished flats can I claim different or do all properties rented out have to be treated the same?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
.

Take a look here and, in particular, here and here on what constitutes a fully furnsihed letting purposes of the wear and tear allowance.

I tell clients that the property must contain enough in the way of furnishings to be able to move into and not need to buy anything themselves. HMRC can and do check claims wear and tear allowance but you'd have to be pretty unlucky to be picked check. The second link gives details of the type of things covered by the wear and tear allowance. However, I wouldn't necessarily say that the lack of a television or even crockery or cutlery is a deal breaker. So long as the property has beds, sofa, armchairs, a table and chairs, curtains or blinds, wall and floor coverings and white goods such as oven, hob, fridge freezer and washing machine in the kitchen, HMRC are unlikely to disallow a claim and tear allowance.

The wear and tear allowance is given on a per property basis so you can choose whether to claim it or not individual property.

If the property is only partly furnished, you can claim of items.

I hope this helps but let me know if you have any further questions.
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Customer: replied 2 years ago.

I have just read a tax book and the information says that once you choose a method to claim wear and tear or replacement allowance you must use it on all your rental properties. This conflicts with the advice you have given me . can you clarify this please.

Thanks

Liz

Expert:  TonyTax replied 2 years ago.
Would it be possible to scan and send to me the relevant pages please.
Customer: replied 2 years ago.

I Cannot scan but here is the exact wording it is from a book written by Carl Bayley BSC ACA who states he is a tax expert. "once you have chosen one method you must stick with it on ALL of your furnished lets

on all of your properties! "He then advises that if you think one method would be best on one or more properties and one on another to consider acquiring some properties yourself and the others by your spouse. I have rung the tax office but I am still waiting ring back on this. This is really important to my son as it the first tax return properties his father left when he died and we need to get this right as I also understand that once the decision is made you have to stick to it. His father always claimed wear and tear but many tenants now want to put there own furniture in and I am not sure if we should continue this. Thanks

Expert:  TonyTax replied 2 years ago.
I have the book you are referring to. I'll get back to you in a bit.
Expert:  TonyTax replied 2 years ago.

again.

My HMRC approved software allows me to claim wear and tear allowance on a property by property basis and always has. The software company have to have their software cleared by HMRC before it can be released and they are adamant that HMRC have never had a problem with this. Some taxpayers chose this way as they didn't want to make a claim and tear allowance and then have it rejected and opted renewals basis instead. Once a method has been chosen individual property it has to be stuck with.

As HMRC have effectively withdrawn relief of furnishings and white goods with effect from 6 April 2013 (this is a matter being disputed by the professional bodies and some taxpayers are still claiming ), your son will better off claiming wear and tear allowance and trying to make sure his properties are fully furnished or he will get no relief at all.

Click on the first link of the seach results here and you will see what a mess this legislation is right now.

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