Landlords of furnished residential properties have for many years been able to claim a ‘wear and tear’ allowance, intended to cover the cost of replacing furniture & furnishings over time.
From April 2016 the rules are changing,the wear and tear allowance is being withdrawn. Landlords will only be able to claim tax relief for amounts that have actually been spent on replacement items.
The replacement should be substantially the same as the old item. Any costs relating to improvements must be disallowed, and sale proceeds (if any) must be taken into account.
However, unlike the wear and tear allowance this relief will also be available to landlords of unfurnished or partially furnished properties.
For more information, please contact Lesley Sutton on 01484 550037 or email email@example.com.