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Rental portfolio with Flats

Are block management charges, if excessive allowable ?

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Client has a number of flats in rental portfilio

On one of the flats, the block management service charge tendered by the freeholder is almost equal to the rent. this is of course unusual and, i suspect includes some kind of capital expenditure, such as roof or building fabric repairs. (not seen the service charge buget so at this stage, pure speculation).

Question is ...

if the service charge includes costs which, appear to be capital in nature, are the management charges allowable as a rental income deduction ?

 

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By ireallyshouldknowthisbut
06th Oct 2017 11:49

"i suspect includes some kind of capital expenditure, such as roof or building fabric repairs"

That is your problem in two points.

1. How can a repair be a capital expenditure?
2. If you don't know for a fact what the expense is, how can you book it for tax purposes?

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