Service charges and repairs – Allowable expenses?

Service charges and repairs – Allowable expenses?

0:43 AM, 1st July 2022, About 3 months ago 4

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My daughter is living, rent-free, in my last remaining BTL, a leasehold flat. Decided that with all the additional legislation coming to get out of the PRS.

In 2021-22 I did not rent out the 2nd bedroom due to worries re Covid and having eventually managed to remove my daughter’s flatmate from hell.

I am still liable, as owner, for the monthly service charge and any additional repairs/exterior and communal maintenance.

1. Can I claim these expenses as allowable expenses to offset against income for 2021-22? I am also a freelance editor and now a state pensioner with a minuscule private pension which didn’t perform as I hoped it would.

2. Tax year 2022-23 the 2nd bedroom has/will be spasmodically rented out, either as a short excluded occupancy (1-8 weeks) or for odd nights to visiting actors coming to London for auditions/rehearsals/the odd performance or film shoot etc.
Can I offset the monthly service charge, any additional repairs/exterior and communal maintenance plus laundry/cleaning against income?

Many thanks

Judith



Comments

David Smith

11:28 AM, 1st July 2022, About 3 months ago

I would say yes you can claim your Service Charge from 2021/22 because the property did not cease trading it was just run at a loss because the spare room was not let out.

You can even carry nett losses over to the next tax year.

David

18:16 PM, 1st July 2022, About 3 months ago

Offset against what if you have no rental income and your letting business has ceased?

David Smith

18:29 PM, 1st July 2022, About 3 months ago

Reply to the comment left by David at 01/07/2022 - 18:16
The business hasn’t ceased trading and made a loss in 2021/22. Thus the second room is being let in 2022. plus you can carry over a loss to a profit year hence she can offset the service charge against 2022 tax year

Cathie View Profile

22:43 PM, 1st July 2022, About 3 months ago

Does it have a mortgage? Is it BTL and do they know that your tenant is a relative?

So if you are not getting market rent for it, your expenses you can claim will be limited. You need to look at the HMRC guidelines.

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