Concise Accountancy

Accountants and Registered Auditors

Business tax

Wear and tear allowance

Wear and tear allowance is abolished after 5 April 2016. A new relief called Replacement Domestic Item relief is introduced to replace the allowance.

You can still claim the wear and tear allowance in your self assessment return up to 5 April 2016.

Calculate wear and tear allowance

You may claim W&T allowance if you paid for the following items in renting out of your property.

  1. Bed
  2. Sofas
  3. Televisions
  4. Fridge, freezer, washing machine, dryer (including other white goods)
  5. Carpets and floorings
  6. Curtains, linen
  7. Crockery or cutlery
  8. Portable/movable furniture and fittings like table and chairs and cupboards

The W&T allowance is 10% of the net rent. The net rent is rental income less any costs and expenses incurred for the property. You must not include expenses paid by your tenants such as council tax bill, gas, electricity and water etc.

If you claim the 10% allowance, then you cannot claim the cost of repairing or replacing the furniture and fitting for that property. This includes missing cutlery and broken cupboard door and so on.

If you rent your a residential property from a landlord. Subsequently, you sublet it to another tenants. In this case, you cannot claim the allowance if you did not furnish the property for the tenants.

Seek accountants advice if you are not familiar with the income tax rules for property lettings business.

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