Repairs vs improvements — the key distinction
Repairs are allowable: replacing a broken window with the same type, fixing a leaking pipe, repainting walls, replacing tiles in a bathroom that match the existing.
Improvements are capital, not allowable against rental income: adding an extension, fitting a brand-new kitchen where there was none, upgrading single glazing to double glazing (if seen as enhancement). They reduce CGT on sale but don't reduce annual tax.
The grey area: replacing a 1970s kitchen with a modern equivalent. HMRC's view is that like-for-like replacement at modern standard is a repair; a clear upgrade is capital. Get an accountant's opinion before claiming.
The full allowable list
- Letting agent and management fees
- Tenant find fees
- Buildings, contents, and landlord insurance
- Mortgage interest (as 20% tax credit for individuals)
- Ground rent and service charges (leasehold)
- Repairs and maintenance
- Decorating between tenancies
- Council tax and utilities during voids
- Legal fees on lease renewal (under 50 years)
- Accountancy fees
- Replacement of domestic items in furnished lets (like-for-like)
- Travel to inspect or carry out work (mileage at 45p / 25p)
- Phone and admin (apportioned)
Frequently asked questions
Is a new boiler an improvement or a repair?+
Usually a repair — like-for-like replacement of an existing boiler is allowable, even if the new model is more efficient than the old one (HMRC accepts that you have to replace with current models).
Can I claim travel to my BTL?+
Mileage at 45p for the first 10,000 miles, 25p after, when travelling for inspections, repairs, or to meet tenants. Not allowable for general 'visiting the property to feel reassured'.
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