The information on this page does not constitute professional advice and we recommend that you check with a qualified accountant or tax specialist, however, in general terms…
When renting out property you can deduct a variety of expenses and tax allowances from your rental income including interest on property loans. If you have more than one residential rental property you can pool the income and expenses together (including the interest on property loans) to work out your taxable profit/loss.
Other expenses you deduct include:
· Letting agent’s fees
· Legal fees for lets of a year or less
· Accountant’s fees
· Buildings and contents insurance
· Maintenance and repairs to the property (but not improvements)
· Utility bills and Council Tax (if not paid by the tenant)
· Ground rent and service charges
· Other direct costs like phone calls, stationery and advertising
How much you can claim depends upon your tax status. And bear in mind too, that the rules are changing. Between 2017 and 2020 tax relief on buy to let mortgage interest (and other finance costs) will be gradually restricted to the basic rate (20%) for higher tax rate paying individuals.
1st January 0001