Property Income Flashcards
Is rent taxed on an accruals or actual basis?
Accruals Basis.
Is property income non-savings, savings or dividend income?
Non-savings.
Are incidental expenses calculated on an accruals or actual basis?
Accruals Basis.
Are capital costs deductible?
No, as they give long term benefit.
If a landlord buys furniture to furnish a rental property, would this be deductible?
No.
If a landlord replaces furniture in a furnished rental property, would this be deductible?
Yes, the full cost of the replacement furniture may be deducted.
How are income and expenses treated where there are multiple properties?
We would pool the income and expenses together to calculate taxable property income.
Is there a time limit to how long property income losses can be carried forward?
No, a loss can be carried forward indefinitely.
How are income and expenses for Furnished Holiday Lets (FHL) pooled?
Separately with other FHLs. Other properties are kept separate.
How many days in a tax year must a property be available to let and actually let to qualify as an FHL?
Available to let for at least 210 days each tax year.
Let for at least 105 days each tax year.
What are the advantages of having an FHL?
- Income may be put in to a pension scheme. This is essentially tax free therefore. This doesn’t apply to normal rental income.
- Capital allowances can be claimed on furniture rather than the renewals basis.
