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TonyTax
TonyTax, Tax Consultant
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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We live in a house with a self-contained furnished flat, although

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We live in a house with a self-contained furnished flat, although the flat has interconnecting staircase, we typically leave it locked although both parties have keys in case of emergency, the flat has own entrance. The tenant does not pay council tax, utilities and broadband as the rent is deemed as all-inclusive and we pay all these directly.
How do I treat the income and what allowable expenses can I off-set, I presume i can still discount for wear and tear but not sure how to treat my mortgage interest, utilities, council tax - can I off set the whole or part and how do I calculate an appropriate proportion.
Flat is 1 bed which in effect leaves us with a 2 bed maisonette above.
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi. When did the letting start?
Customer: replied 1 year ago.
I am looking at doing my self assessment for year ending April 2015.
The flat was rented out from Jan 2012 through to January 2015.
Expert:  TonyTax replied 1 year ago.
Thanks. Since the property was let in 2012 how have you accounted for expenses to date? Did you claim wear and tear in earlier years or replacement costs?
Customer: replied 1 year ago.
wear and tear. It was more the other expenses I could claim I was concerned with.
Expert:  TonyTax replied 1 year ago.
Thanks. Once you have chosen a method (wear and tear or replacement cost which wasn't available for 2013/14 or 2014/15 in any event) for a property, you are stuck with it. I would claim a proportion of the utilities costs, mortgage interest, countil tax, insurance, maintenance and repairs to common areas including outside but not to your exclusive area etc based on floor space. The broadband cost is a lttle more difficult to apportion and I'd be inclined to claim a notional sum. Takae a look here for the types of expenses you can claim. I hope this helps but let me know if you have any further questions.
Customer: replied 1 year ago.
so appropriate proportions of allowable expenses based on sq ft or useage is allowed, great.
Expert:  TonyTax replied 1 year ago.
Using the area method would seem to me to be the fairest way of dividing the expenses applicable to both properties to me and its commonly used.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15840
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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