buy to let Application costs from previous years

I moved from my property to a new one and converted my earlier property to a buy to let. While the move happened in Aug 2022, the mortgage application was made and approved in Feb 2022 ( previous tax year). I didn't have any rental income in that tax year and did not declare any expenses associated with the mortgage including application fee and advisor fee. Am I allowed to declare these costs and claim deduction and if so how should I go about it? Thanks

Hi, 
 

Thank you for your question. Usually, the rental business does not begin until the first property is let. Any expenses incurred before the first let must be solely for the rental business and must not be capital expenditure. Any qualifying pre-letting expenses are treated as incurred on the day the rental business commences, which to confirm, is usually the day the property is first let. After the first property has been let, any later expenditure leading up to the letting of the second and later properties is part of the rental business and can be deducted - provided it is incurred wholly and exclusively for the purpose of the business and isn’t capital expenditure. For further information, see  : Property Income Manual . The costs incurred in obtaining loan finance for a rental business can be deducted from the rental profits providing the costs are incurred wholly exclusively for a property let at a commercial rate. Guidance at PIM2105 refers. Thank you.

Thank you for this Guidance. How are costs related to the below considered, as these are exclusively done for the sake of rental business prior to commencing the renting 1. Gas safe, Electrical certificate expenses, 2. EPC charges related to rental 3. Any other expenses related to specific regulatory requirement for renting. Regards,

Hi,
 

Thank you for your question. Usually, the rental business does not begin until the first property is let. Any expenses incurred before the first let must be solely for the rental business and must not be capital expenditure. Any qualifying pre-letting expenses are treated as incurred on the day the rental business commences, which to confirm, is usually the day the property is first let. For further information, please see: PIM2505 - Beginning and end of a rental business: commencement  . EPC, gas and electrical expenses are tax-deductible. For a list of what you can, and cannot, claim as expenses, please see the guidance at: Work out your rental income when you let property   .  Thank you  .