Part furnished residential accommodation

Part furnished residential accommodation

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If a house is provided with carpets, curtains, washing machine, fridge etc, but NOT beds, tables etc is it furnished residential accommodation as far as the 10% wear and tear allowance is concerned?

If not, it does not seem reasonable to claim the cost of the above are capital improvements, as there lifespan is a lot less then the house. So I think they should be able to be offset against the rental income. If I am correct can they be covered by the first year capital allowance and written down 100%.

(The items were all installed before the first tenant moved it, so they can’t be covered by “like for like” replacement)

Ian Ringrise

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By Ned Ludd
08th Jun 2009 18:58

is there not a renewals basis thereafter the initial purchase?

eg. the initial cost of a bed would be disalloweble but the replacement a few years down the line would be a revenue expense?

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Euan's picture
By Euan MacLennan
08th Jun 2009 18:19

No & No
No - "furnished" means that a tenant could live in the house without having to buy any furniture. A fitted kitchen, but otherwise empty rooms, is not furnished and you cannot claim the 10% wear and tear allowance.

No - you cannot claim capital allowances for plant or machinery provided for use in a dwelling-house.

Nor is this a cost for capital gains purposes on the eventual sale of the property, because it is not an intrinsic part of the property.

There is no no tax relief available on this expenditure to put the property into a state for letting.

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