Landlord Expenses: What you can and cannot claim for

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The life of a landlord has got much harder over the past few years. Higher interest rates, stagnant or falling property values and unfavourable changes to the tax system mean that some property owners are making a loss on their investment. 

That makes it more important than ever that landlords claim for all the expenses they can to reduce their taxable profit. Fortunately, there is a wide range of reliefs and allowances available. So how can landlords ease the financial strain?

Fixtures and fittings

Generally if tenants break or damage a fixture or fitting, they are responsible for the cost of making good. 

However, where the damage was not the tenant’s fault, eg, storm damage, a broken window from a break-in or a blown-down fence, landlords are allowed to claim for the cost of repairs, minus any money received from an insurance claim.

The property

Fixing roof or guttering damage caused by bad weather is claimable. However, in most cases these costs will be recoverable via buildings insurance, leaving the claim as the excess payable on the claim.

You can claim for the cost of repairs done on the property as well as that of replacing kitchen white goods or bathroom units. However, the new units should be of the same quality as the old ones. Only replacements of the same quality can be fully claimed for: the landlord must bear the cost of the difference in price between higher quality and like for like goods.

The boiler of a rental property will inevitably go at some point and HMRC allows claims in full for the purchase and installation costs of a new like-for-like boiler.


Landlords can claim for fixing faults with the supply of water, gas and electricity –which is of course net of any sum received in an insurance claim.

Redecoration and maintenance

External maintenance to walls, paths, roofs and so on is also claimable but as ever the landlord should not claim for the difference between like-for-like replacements and improvements. 

HMRC sees redecorating as maintenance so any such costs are fully claimable.

Ground rent and service charges

Landlords who let out flats will in all likelihood have to pay ground rent to their freeholder. This is usually a much smaller sum than the rent received from the tenant and is typically about £150 to £600 a year. This is fully claimable. The same goes for monthly service charges for maintenance and property management, which range from about £80 to £250.


Most landlords do not own their properties outright and it is a condition of their mortgage policies that they have buildings insurance. Fortunately this cost can be chipped off the tax bill.


One improvement that it is possible to claim for is replacing a broken single-glazed window with a double-glazed one. This is because the double glazing is incidental to the repair.

Council tax

If the let property is a house (or flat) in multiple occupation (known as an HMO)– which is to say there is an individual tenancy agreement for each person or couple living there – then the landlord should pay the council tax and it is a claimable expense. Where the property is let as a single household then it is the tenant or tenants’ responsibility to pay it and it is not a claimable expense.

Handover periods

Landlords often use the period between tenancies to spruce up a property. The costs involved such as gardening, redecorating and professional cleaning can be deducted from their tax bill so employed landlords should consider whether or not it is worth giving up their valuable leave days to do it themselves, particularly in the case of window cleaning and house cleaning where they are unlikely to be able to do it to the same standard.

Estate agents

Most landlords prefer to let an estate agent find their tenants. This is a substantial cost – most charge the equivalent of a month’s rent for their tenants’ finder fee – but fortunately it is fully claimable and the landlord has the peace of mind of knowing the deposit is securely stored and the new tenant has been through credit checks and references.

Legal fees

You can’t claim for any legal costs involved in letting your property for the first time or for more than a year. However, where the let is for less than a year, you can claim. Any legal and professional fees incurred for reletting a property are claimable as long as the new lease is for less than 50 years. You can also claim for the cost of evicting tenants.

Furnishings and contents

You are not allowed to claim for replacing furniture and everyday things like crockery or bed linen as maintenance costs. However, they are claimable under the heading of domestic items relief. To qualify these sorts of items should be of low value and need to be replaced regularly (nearly every year).

Property allowance

You can claim £1,000 a year in property allowance if you don’t claim for your expenses, in effect giving you £1,000 of tax free property income. Most landlords, especially if they let flats with management charges and ground rent, will be better off not claiming this relief and claiming for actual expenses.

Letting relief

If you share the property with your tenants you can get a reduction on capital gains tax if you sell your home.

Other costs

You can claim for vehicle and fuel costs relating to managing your property, also for advertising for tenants if you aren’t using an estate agent. Any professional fees or subscriptions paid in your capacity as landlord are claimable, as are phone calls relating to your property business. And the cost of getting rid of worn-out furniture and appliances is allowable.

And now the bad news

There are some major expenses you cannot claim for as a landlord. 

Capital expenses

Any capital expense, that is improvements or additions to the property or the cost of buying something that will be in use for a long time is not claimable. So adding a burglar alarm, a conservatory or an extension, for example, is not claimable. HMRC sees these as capital expenditure that enhances the property and not as running repairs or maintenance. However landlords should keep all records relating to such expenditure as it may be possible to set if off against capital gains tax.


Landlords who buy rundown properties and do them up will not be able to claim the costs of bringing them up to spec for renting out. 

The big one: mortgage finance costs

Landlords have taken a hammering since tax changes introduced by George Osborne when he was chancellor of the exchequer began to take effect. 

Over a four-year period from 2017 the amount of tax relief landlords could claim on mortgage interest costs fell from 100% to zero in 2020. Alongside this, HMRC introduced a tax credit on mortgage finance costs, which currently amounts to 20%. 

Thus landlords now pay income tax on the money they spend servicing their mortgages and, in the case of landlords who have income of more than £50,270, they will pay additional rate tax of 40% on this income.

Is it still profitable being a landlord? 

The ending of tax relief on mortgage interest in 2020 as well as the steady rises in interest rates since December 2021 have led to many landlords making consecutive annual losses and selling up.

That means really making the allowances and relief regime work for you is key to maintaining profitability in a challenging market. To achieve this it is advisable to have a firm of accountants do your self assessment. Only they will be able to fully exploit the available allowances while staying compliant with HMRC rules.

The online HMRC self assessment forms offer minimal guidance, can be confusing and it is easy to make errors if inexperienced. If HMRC detects underpaid tax, it will want it repaid with interest plus an uplift that could be as much as 30% if it deems the underpayment to have been negligent. 

An accountant’s fees for preparing a self assessment are likely to be less than the savings made by having the work done correctly. Landlords also have the peace of mind that comes with knowing they won’t be liable for interest, penalties or fines.

The accountants at Finsbury Robinson will be happy to help you get your property business running in the most tax efficient way. Please give our friendly team a call on 020 8858 4303 or email us at

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January 17, 2024
Finsbury Robinson

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