Landlord Allowable Expenses — The Complete 2026/27 List

Every pound of allowable expense saves tax at your marginal rate — 20% to 48% — which makes the expenses file the highest-yield paperwork a landlord owns. The rule (ITTOIA s.34): costs are deductible when incurred wholly and exclusively for the rental business, revenue (not capital) in nature. Here is the practical translation.

Deductible — the everyday list

• Repairs & maintenance — fixing, redecorating, replacing like-for-like (the boiler repair, the repainted walls, a broken window)
• Agent fees — letting, management, tenant-find; accountancy for the rental accounts
• Insurance — landlord buildings/contents, rent-guarantee
• Compliance — gas & electrical certificates, EPCs, legionella checks, licence fees (a £925 five-year selective licence is deductible)
• Council tax & utilities in voids, ground rent, service charges
• Advertising, referencing, deposit-scheme fees; legal fees for lets of a year or less and renewals under 50 years (not purchase legals — those are capital)
• Replacement of domestic items — like-for-like sofas, white goods, carpets in furnished lets (the improvement element of an upgrade is excluded)
• Motor expenses for property visits — HMRC’s flat 45p/25p mileage rates keep it simple
• Phone, software, subscriptions — the rental-business proportion, incl. MTD software

Never deductible against rent

• Mortgage capital repayments — not a cost at all; interest & finance costs — not deductible either, but earn the 20% Section 24 credit
• Capital improvements — extensions, conversions, first-time installations: these join your CGT cost base for the sale instead
• Purchase costs — SDLT, buying legals, survey (CGT cost base again)
• Your own time, dressed as a “management charge”
• Personal-use proportions of anything

The line that decides disputes: repair vs improvement

Replacing a broken wooden window with a standard modern uPVC equivalent = repair (current standard like-for-like counts). Adding a window where none existed, or upgrading to something materially better = improvement (capital). The question is always “restored what was there, or enhanced it?” A big “refurbishment” invoice usually contains both — ask the contractor to itemise, because the split is worth real money at both ends (income tax now, CGT later).

The £1,000 property allowance — either/or

Claim the flat £1,000 instead of everything above and the finance credit. Right answer for tiny unmortgaged lets; wrong for almost everyone else. The calculator compares both routes automatically.

Pre-letting costs

Revenue-type costs incurred up to seven years before the first let (getting the property ready to market, not buying or improving it) are treated as incurred on day one of the business — commonly missed by first-time landlords with a gap between purchase and first tenant.

HMRC Property Income Manual (wholly-and-exclusively, repairs, replacement-of-domestic-items) · gov.uk expenses guidance. Checked 29 Aug 2026.