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Posted Wed, 04 Oct 2023 20:20:58 GMT by richardc croome
Hi - I purchased a BTL house (10 year old house) in August 2014 - tenant paid all along for 30 months then just stopped paying - eventually after legal proceedings evicted but due to lawyer errors and Covid court delay it took 30 months - error of submissions etc - nightmare! I have now been awarded £280 / month to be paid direct from employer - but debt is over 30k so long haul - Legal costs @ 8k. I have now sold the property - July 2023 and will face C.G.T. as value in 9 years has increased - can any of these losses be offset? The property required renovation after eviction to the tune of 7,5k - thanks - cannot see any threads on this in the community.
Posted Tue, 10 Oct 2023 10:40:57 GMT by HMRC Admin 32

The costs of evicting the tennant can only be set against the income from the property in box 27 of SA105.

UK Property Notes

PIM2120 - Deductions: main types of expense: legal and professional costs

General maintenance and repairs can only be set against property income.  

See PIM2025 below.

PIM2025 - Deductions: repairs

Where improvements, such as a conservatory or and extension have increased the value of the property, the these can be considered as capital in nature and set against any capital gains.  

Replacements, such as doors, windows, roof tiles, boilers can only be set against property income.  

Please also have a look at PIM2072, regardng bad and doubtful debts. 

PIM2072 - Deductions: main types of expense: bad and doubtful debts

Where the expenses are greater than the income, a loss arises. This can either be carrief forward or set against other income.

Thank you.

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