Chapter 8 Property Income Flashcards
1
Q
8.2 Expenses
A
Rental income is treated as business income, so deduction of expenses follows the normal rules. Relief is given for expenses that have been incurred wholly and exclusively for the purposes of the rental business. Common examples are repairs, insurance, management and agents’ fees, advertising, replacement of domestic items and capital allowances in respect of capital expenditure on domestic items in furnished holiday accommodation.
2
Q
8.3 Loan Interest
A
Interest on a loan taken out to purchase a rental property is not an allowable expense in arriving at the income taxed as profits from a property business. The loan is treated as a non-trading relationship expense under the loan relationship rules.
