From my Ten Things series.
When you buy a house you will normally get a survey or as a minimum of valuation report. These things cost and you’ll like want to claim the cost as an expense. Like other purchase or sale costs these are part of the capital side of the deal and will form part of the base cost of the property for when it is eventually sold.
What happens though if you get a survey done and it comes back as bad news. The place is falling down and should be avoided at all costs. Where does the claim fall? Well it might surprise you too find out it doesn’t! It’s still a capital cost but you don’t have an asset to claim it against as you never bought it! This is different if you are buying properties as part of a trading business where you flip but for the unlucky BTL investor it is simply lost.
Only 22% of people answering this question got it right meaning that 78% are claiming a rental expense for a cost that is now allowable. Probably a good time to remind you there are 5,000 new compliance officers coming…