I wouldn't mind being audited. Then I think I could throw away boxes and boxes of receipts and files.It's really not that unusual for Revenue to raise queries on tax returns.
I am tax qualified. I am strongly of the view that Sarenco is correct.
If I was replacing a bathroom in my rental property, I would record it as enhancement and take a deduction against the gain when I sell it.
I would claim capital allowances over 8 years for apparatus like a boiler.
If I’m repairing something (like an existing shower or a floor), I just claim a full income tax deduction.
Wanting something to be the answer to a question does not make it the right answer.
My accountant is tax qualified. Hired by me from this website having sufficiently impressed me with the expertise in posts.I am tax qualified. I am strongly of the view that Sarenco is correct.
If I was replacing a bathroom in my rental property, I would record it as enhancement and take a deduction against the gain when I sell it.
I would claim capital allowances over 8 years for apparatus like a boiler.
If I’m repairing something (like an existing shower or a floor), I just claim a full income tax deduction.
Wanting something to be the answer to a question does not make it the right answer.
Surely something has to be faulty, damaged or worn out for the replacement to constitute a repair?
For example, simply replacing an item with something of a similar spec won't constitute a repair if it's purely for reasons of taste or fashion.
Does anybody remember avocado bathroom suites from the 80's?
I'm not sure I agree that simply using an item for its intended purpose necessarily means that its condition will be inferior/deficient to its original state. But I certainly agree that replacing a worn item on a like-for-like basis could constitute a repair.I think the only requirement would be that the asset has been used, and therefore its condition is in some way inferior / deficient relative to to its original state.
I don't. The replacement bathroom was demonstrably of a better quality/specification to the one it replaced. It was very clearly an improvement on what was there previously by any reasonable measure.I think your relative was simply lucky
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If a deduction for a boiler isn’t claimed via capital allowances over 8 years, then why do certain energy efficient boilers qualify for accelerated capital allowances?
I am also struggling to think of an instance where I or anyone I know (e.g. clients, friends, or family) has renovated a bathroom on the basis that its constituent parts were no longer fit for purpose.
It’s always been “that looks a little tired”, “I no longer need a bath”, or “we should really reconfigure that”.
Whatever about the materiality qualifier (can you point to anything in that regard?), I am delighted to see that you now seem to finally accept that replacing a fixture that improves or enhances a property beyond its original condition is not a deductible expense in calculating a rental profit.If you replace fixtures (capital items) and do not materially improve / enhance the property as a whole beyond its original condition / functionality
Whatever about the materiality qualifier (can you point to anything in that regard?), I am delighted to see that you now seem to finally accept that replacing a fixture that improves or enhances a property beyond its original condition is not a deductible expense in calculating a rental profit.
But it is a deductible expense in calculating any subsequent capital gain.
You’re right, we don’t, as an absolute fact. But I struggle to see how one can demonstrate an enhancement to an entire property by virtue replacing the bath, shower, toilet bowl, sink and tiling in a pre-existing bathroom, at a total cost of 5k.Hopefully you will also be big enough to acknowledge that we simply don't know what category the OP's bathroom refurbishment falls within as a factual matter.
Resurrecting an old thread but it is very interesting to me currently. You mention "generally" here. What pre-letting expenses can be deducted from taxable rental income? Do LL's really wait until tenants are in situ before doing the place up (lick of paint, minor remedial works etc)? I can't imagine too many tenants would be willing to accept that. I would be interested to hear how LL's approached this?Well, generally pre-letting expenses are not deductible so it might actually be advantageous to treat the works as capital expenditure (and not a repair) in those circumstances.
Basically pre-letting expenses (subject to a cap) on vacant property -Resurrecting an old thread but it is very interesting to me currently. You mention "generally" here. What pre-letting expenses can be deducted from taxable rental income?
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