Will HMRC accept those deductions for CGT vs gain on BTL?

[nickfrog]

The chargeable gain is close to our combined CGT allowances for this year so has anyone successfully deducted those items when they sold their property:

New roof / fascia / soffit / guttering: £7k (being done now)
New garden office cabin £8k (last year)
New carpets £1.2k (last month)

Thanks a lot for any guidance as HRMC's site not that granular.

[Eric Mc]

Do they count as “Enhancement Expenses”?

We’re they claimed previously as expenses against rental income?

[nickfrog]

Hi Eric and thx for that. I don't know what the test is for them to be "enhancement expenses" but none of them were used against rental income.

[Eric Mc]

If the expenditure "enhances" the property i.e. takes the property to a level over and above where it was when it was first acquired.

[nickfrog]

Eric Mc said:

If the expenditure "enhances" the property i.e. takes the property to a level over and above where it was when it was first acquired.

I think the new garden office/cabin does but not sure about the new roof or the carpets.

Do enhancement expenditures qualify or not for deduction ? Thx Eric.

[RichardAP]

nickfrog said:

I think the new garden office/cabin does but not sure about the new roof or the carpets.

Do enhancement expenditures qualify or not for deduction ? Thx Eric.

Carpets almost certainly not.

Garden office yes, on the basis there wasn’t already one there.

Roof, depends. If you bought it needing a new roof then yes as you’ve improved the property, if it had a nice roof when you bought it x years ago and it now needs replacing then no.

Link is helpful and I assume you’ve claimed the relevant reliefs if they apply to you.

https://www.gov.uk/tax-sell-property/work-out-your...

[nickfrog]

RichardAP said:

Carpets almost certainly not.

Garden office yes, on the basis there wasn’t already one there.

Roof, depends. If you bought it needing a new roof then yes as you’ve improved the property, if it had a nice roof when you bought it x years ago and it now needs replacing then no.

Link is helpful and I assume you’ve claimed the relevant reliefs if they apply to you.

https://www.gov.uk/tax-sell-property/work-out-your...

Cheers Richard.

Yes the Garden office is new and not replacing anything.

The property is 1920s and on its original roof when we bought it 4 years ago ; it was probably on its last leg then as the battens are now by and large soaked/rotten.

[RichardAP]

nickfrog said:

RichardAP said:

Carpets almost certainly not.

Garden office yes, on the basis there wasn’t already one there.

Roof, depends. If you bought it needing a new roof then yes as you’ve improved the property, if it had a nice roof when you bought it x years ago and it now needs replacing then no.

Link is helpful and I assume you’ve claimed the relevant reliefs if they apply to you.

https://www.gov.uk/tax-sell-property/work-out-your...

Cheers Richard.

Yes the Garden office is new and not replacing anything.

The property is 1920s and on its original roof when we bought it 4 years ago ; it was probably on its last leg then as the battens are now by and large soaked/rotten.

I assume you have also captured all of the buying and selling costs, legal fees, stamp duty etc

[nickfrog]

RichardAP said:

I assume you have also captured all of the buying and selling costs, legal fees, stamp duty etc

Cheers yes all those have been deducted fortunately...