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Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13997
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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I started to rent out my house in the UK last year and

Resolved Question:

I started to rent out my house in the UK last year and sometimes have to fly home for property maintenance (usually about twice per year).Is it possible to claim this expense against my tax?
Also, what about when I rent accommodation for the period I am in the UK?
Submitted: 1 year ago.
Category: Tax
Expert:  Sam replied 1 year ago.

Hi

Thanks for your question - I am Sam and I am one of the Uk tax experts here on Just Answer

Can I ask

1) Do you have a managing agent that collects rents etc for you

2) Are there any other reasons you come back to the UK or are the visits JUST just for property maintenance, and how large are these jobs that see you having to come back to the Uk rather than hire out tradesmen?

3) How long are each of the visits which would require you to rent out property whilst you re in the UK ?

Thanks

Sam

Customer: replied 1 year ago.
Hi SamThanks for your quick reply. Please see my answers below:1) Yes I have a managing agent, but up until now we have taken care of the repairs ourselves. The agent has handled all contractual and financial stuff with the tenants.2) Last year the visits were mainly due to the property as we had some teething problems with the property. I also took the opportunity to visit relatives etc while there so would estimate it to be 50% of the reason for the flights then.
However in the future, we have another house which I am preparing to rent out from August. I am therefore planning to fly back to the UK in order to decorate and pack/move things from the house in June and July (2 trips). I will also meet the letting agent and also other estate agents in preparation to rent out another house.3) I estimate the period of time would be around 10 days to 2 weeks for future visits.Would I also be able to claim things such as car/van hire, or even taxis to/from the airport?Thanks again.
Expert:  Sam replied 1 year ago.

Hi

Thanks for your responses

As you stay long enough in the UK to visit relatives then these costs were not wholly and exclusively expenditure that arises for the house and carrying out maintenance.

Furthermore HMRC will question why you did not use the managing agent to get a tradesman in - as I assume they are there to manage the rental month by month in your absence, and you pay them to do this so this is further cost that you have already incurred and for this reason along with the fact you visit relatives whilst here - I am afraid HMRC will not accept any element of the claim to date.

I should also advsie getting this property ready for rental is not an allowable cost as you can only claim for costs incurred once you have tenants in place (so genuine maintenance and repairs)

You did not advsie furtehr how come you paid out rental costs but as this is not a valid claim then how or why those costs arose are I am afraid also not even to be considered.

Same with costs to and from airports or car or van hire. HMRC will just view this as funding a holiday which I am sure you can appreciate.

Costs for the repairs and the costs to and from where you stay in the Uk to the rental property would be allowed.

I am sorry the news is not more favourable.

For future claims - you would have to either ask the managing agent to oversee the repairs OR make sure trips to the UK were solely for the repairs or maintenance and those costs can only be allowable when you have tenants living in the properties and you are collecting the rents.

Then you could have the costs to and from the UK and costs whilst here

Thanks

Sam

Customer: replied 1 year ago.
Hi SamThanks for the detailed response and I appreciate that for the previous flights HMRC would be unlikely to accept them. Also for the 2nd house due to the work being before tenants move in.I do however have one further question which is the scenario in between tenants moving out and new ones moving in. I can already see that decorating will be needed, and I am planning to do this myself to keep costs down (the cost of flights, materials and accommodation would actually be less than the cost of getting in a tradesman). Usually the agent only arranges the tradesman, but I would still have to pay for the actual work otherwise which would not be cheap.Would these factors make it an acceptable to HMRC?Thanks again.
Expert:  Sam replied 1 year ago.

HI

Thanks for your response and apologies for my delay I was with a client on the telephone

Any decorating between tenants is your cost to bear and not an allowable cost against the rental income so any costs associated to carry out these costs are also not allowable

Only genuine repairs and maintenance whilst the tenants is living there (so they can make use of a fully functional clean and dry property) are allowable costs

Thanks

Sam

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