Property Income - Additional CCJ Fees Tax Deductible?

Property Income - Additional CCJ Fees Tax...

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Good Afternoon Everyone

I have across a situation with one of my clients whilst preparing his Self-Assessment and i wanted to get an opinion from the Experts regarding the tax treatment.

To summarise, the client rented a new property out but wasn't aware of service charge payments / ground rent given he did not receive the invoices from the Property Management company as they didnt have his correspondence address. Whilst preparing his SA I asked for Ground Rent and Service Charge invoices and upon chasing he has now found out a CCJ was issue in his absence. Given the risk to the property the Bank has paid both invoices but it has meant he has incurred charges given solicitors were appointed for CCJ. This has now been fully settled

The ground rent went from £289 to £1,307

Service Charge went from £2,300 to £3,609

Both will incude laywer costs + court submission etc

Question here is will the whole amount above be tax deductible or just the service charge/ground rent (i will split out for service charge / ground rent in the category) and then the remainder will put through Professional Fees if it is allowable

Your help is very much appreciated

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