The tax rules that apply to property rental income are complex, with many changes in recent years. At Spicer & Co Chartered Accountants in Dunstable, we specialise in helping property investors understand the requirements involved.

“Which expenses can I claim against my rental income?”‘ says Max, an accountant with Spicer & Co. ‘Understanding this can make a big difference to your tax bill and ensures you stay fully compliant with HMRC.’

Are you a property landlord?

Here’s a straightforward guide to what landlords can and cannot claim.

The Expenses Landlords CAN Claim

HMRC allows landlords to deduct expenses that are “wholly and exclusively” for renting out the property.

Common allowable expenses include:

• Repairs and maintenance – fixing leaks, broken fixtures, or redecorating.
• Letting agent and management fees – including tenant-finding services and rent collection.
• Accountancy fees – for preparing rental accounts and tax returns.
• Landlord insurance premiums – buildings, contents, and rent guarantee policies.
• Utility bills and council tax – if you pay these for tenants.
• Service charges and ground rent – for leasehold or managed properties.
• Travel costs – mileage or actual travel costs for property visits (45p per mile is HMRC’s current rate).
• Replacement of domestic items – furniture, white goods, or kitchenware in furnished lets (replacement only, not upgrades).

A comprehensive list of allowable expenses can be seen at GOV.UK.

Does your property qualify as a furnished holiday let (FHL)? If it meets these criteria, the answer is “yes”:

• Your rental property is available for short-term letting to the public for 210 days and actually let for 105 days or more in each tax year, and
• It is not used as a long-term let of over 31 days for significant periods.

Owners of FHLs can still:

• Deduct full mortgage interest.
• Claim capital allowances on furniture and equipment.
• Access certain business reliefs on sale (including 10% CGT rate).

New requirements for FHLs were introduced in 2024. Please contact us if you have any questions.

What Landlords CANNOT Claim as Expenses

‘Many landlords are surprised to learn certain expenses are not deductible,’ says Max. ‘Ensuring you only claim for allowable expenses reduces stress and keeps you on the right side of HMRC. If in doubt, please let us know. We’re happy to clarify whether you can or can’t claim for the expense involved.’

Expenses subject to popular misconception but are NOT tax-deductible are:

• Capital improvements – upgrades, extensions, or high-spec renovations are capital, not repair costs.
• Property purchase costs – stamp duty, legal fees, and survey costs are capital expenses.
• Your own labour – time spent managing or maintaining the property personally isn’t allowable.
• Personal use – any costs relating to periods you or friends/family occupy the property.
• Mortgage repayments – only the interest element qualifies.
• Pre-letting costs – initial decoration or furnishing before tenants move in.
• Fines or penalties – including parking tickets, late tax filings, or tenancy deposit penalties.

Making Tax Digital for Landlords

Making Tax Digital (MTD) for Income Tax affects landlords. The first phase starts on 6 April 2026 for self-employed individuals and landlords with qualifying income over £50,000. Other landlords are impacted in further phases – please check the MTD for Income Tax timeline.

Specialist Support for Landlords

Spicer & Co Chartered Accountants in Dunstable specialises in helping property landlords understand what they can claim and how to structure their accounts efficiently.

Contact us for an initial discussion without obligation to see how we can help your rental property stay compliant with maximise tax efficiency.