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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15946
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I own a berth on a marina - there are marina charges solely

Resolved Question:

I own a berth on a marina - there are marina charges solely related to the berth, of around £800 per year. If I rent out the berth for £2500 per year I presume I have to pay my 40% tax, but can I offset the £800 from the £2500 first..?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

Can you tell me what the marina charges cover please.
Customer: replied 2 years ago.

Things like admin, my share of maintenance of marina & lock gate, plus dredging, staff costs etc etc - it's worked out by the marina owners each year and billed in half yearly charges

Expert:  TonyTax replied 2 years ago.
Thanks.

I can see no problem with claiming those charges against your income from letting the berth. They are directly related. It's no different from the case of a flat owner being able to claim service charges against the rental income from letting.

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

Can I just use section 9 for the £800 charges - i.e. 'other allowable property expenses'

Expert:  TonyTax replied 2 years ago.
.If you are referring to the property income pages SA109 you shouldn't use page UKP1 as that is for furnished holiday lets. Use box 28 or 29 on page UKP2.
Customer: replied 2 years ago.

Yes, sorry - 28 or 29 of UKP2 - I'd been looking at the wrong section..!

Does it matter whether 28 or 29 - 29 looks best to me as the Marina owners just bill this total £800 charge without a detailed breakdown. If the Inland revenue needed a breakdown after I submit my online self assessment, I'd have to write to the Marina owners which I don't want to do unless the tax folk demand it.

Expert:  TonyTax replied 2 years ago.
I'd be inclined to use box 28 as the charge relates to services provided by the marina. The bill from the marina will suffice for HMRC purposes if they ask you for it which I doubt will happen.
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Customer: replied 2 years ago.

Many thanks indeed for the help - excellent

Expert:  TonyTax replied 2 years ago.
Thanks for accepting my answer.