Expenses prior to tenancy start date

I was granted probate in December 2022 and have inherited a leasehold property which has been let out since November 2023. In the time in-between, I was having refurbishment works done to prepare the property for rental, which I know is a capital expense. Can I, however, claim the expenses incurred by ground rent, service charges and utility bills utility bills I incurred prior to tenancy start (between December 2022 - November 2023) against my rental income for the 23/24 tax year?

Hi Brook100,
Yes 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.  
The guidance can be found here:  PIM2505 - Beginning and end of a rental business: commencement
Thank you.





 

Thank you for your response. My pre-letting expenditure for the business is higher than my rental income for the 2023/24 tax year, as it has only been let for a few months. With this in mind, do I still need to submit a self-assessment tax return for the rental income?

Hi,

If your gross rental income exceeds £1000, with the net income being below £2,500 after deductions, then you would not be required to submit a Self Assessment tax return regarding rental income.

If your net income were to exceed £2,500 after deductions, then Self Assessment criteria would be met.

Thank you.