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Posted Wed, 04 Jan 2023 23:10:09 GMT by pra04jgb
I am renting out a property for which I pay ground rent and buildings insurance on a yearly basis. I wish to deduct this as an expense. However, I have only rented the property for 8 months. Is it preferable to work out the cost of the ground rent and buildings insurance per month and include eight months’ worth in box 24. Or should I put the full years’ worth in box 24 and then state four months’ worth in box 30 (private use adjustment). Does it matter which way round it is done?
Posted Mon, 09 Jan 2023 11:39:54 GMT by HMRC Admin 17

Thank you for your question.

You may incur expenses for the purposes of a rental business before that business starts.

If so, you maybe able to claim a deduction for them once the letting begins. Relief is only due under these special rules where expediture is incurred within a period of seven years before the date the rental business started, is not otherwise allowable as a deduction for tax purposes and would have been allowed as a deduction if it had been incurred after the rental business started.

This means that, to be allowable, the expediture must be incurred wholly and exclusively for the purposes of the rental business and must not be of a capital nature.

See :

PIM2505 - Beginning and end of a rental business: commencement    .

Thank you.

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