Wear and Tear Allowance – Save Tax Whilst Sitting Down

When we moved to sunny Saffron Walden there wasn’t a lot of furniture that we kept.  One of the few pieces that made the journey up the M11 was our settee.  This was mainly so we did not have to sit on picnic chairs or bean bags until the new furniture had been delivered.

I am sure that most men are well attached to their settee and I am one of them.  The beige (I think women call it tope) velour seat has been a piece of my life for many years.  In fact if you are a fan of reality TV you might say we have been on an incredible journey together.  All of which is witnessed by the multitude of stains which adorn it.

Over the eight years beer stains have appeared as a result of watching two European championships and a World Cup.  Somehow even the odd Orient match has made its way onto sky sports. I can only assume our match against Droylsdon was scheduled after producers found out the Norwegian cheese rolling contest was postponed.

Chocolate stains are also evident from romantic nights cuddling up with Mrs TTF whilst watching  films.  Years (it feels like decades) of my life have been spent watching, what seems to be, the same rom-com over and over again.  They all seem to have an identical plot; boy meets Julia Roberts, boy doesn’t like Julia Roberts,  Julia Roberts doesn’t like boy, they fall in love, the end….give me Lesbian Vampire Killers anytime!

The birth of my first born, Jabo, can also be witnessed from a stain on the right cushion…I spilt my coffee when the time came to go to the hospital.  The remaining baby related stains are too numerous to list but the projectile vomiting is probably the most vivid!  A little tip for parents to be, don’t buy a suede sofa.

But now is the time to say goodbye.  A new shiny sofa bed is going to be delivered soon which will replace the cushions that have been ergonomically shaped to my buttocks.

It will be a sad day but could a gift of my settee to you save  tax?

THE TAX BIT

The answer is yes if you are also a landlord.  This is because a landlord who lets their property furnished can claim a tax deduction to represent the depreciation of their furniture.  The Wear and Tear allowance is calculated by taking 10% of the gross rents less any expenses incurred that are normally paid by the tenant e.g. water rates.

In order to claim the relief the property must be furnished.  HMRC accept that a property is furnished if it is capable of normal occupation without the tenant having to provide their own beds, chairs, tables, cooker etc.  Although relief will not be allowed if the property is part furnished the term capable of normal occupation is subjective.  Therefore as long as the above items are provided then I would say the relief is available.

As an alternative you can claim on a renewals basis for furniture so careful consideration should be made as you cannot pick and choose.

The average rent for a flat in London is £1,272 a month.  Therefore by providing some relatively inexpensive furniture a landlord could obtain a deduction of £1,526 per annum saving a higher rate tax payer £610 a year.

So who wants a free “distressed look” settee?  Local collection only!

By Peter Cross

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