What capital allowances can I claim in my property rental business? Property rental business owners can claim a diverse range of capital allowances.

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This is a freeview summary of those allowances with links to more detailed guidance.

At a glance

Commercial property

Capital Allowances may be claimed on non-residential let properties:

Residential letting of property

Claims for capital allowances can be limited for certain types of residential lettings businesses.

  • Plant and Machinery allowances cannot be claimed in respect of plant or machinery used in a Dwelling house.
  • Furnished Holiday Letting (FHL) is treated as a trade for Income Tax and not as 'ordinary property letting': the dwelling house capital allowance restriction does not apply to qualifying FHLs.
  • Landlords of furnished and unfurnished properties may claim Replacement of Domestic Items Relief instead of capital allowances.
  • A landlord can also claim capital allowances on the cost of office furniture and equipment, including motor vehicles used in their own business, as a landlord, see Landlords: Capital allowances.

Choice of accounting basis

Claims for capital allowances are restricted for small property businesses who have not opted out of the Cash Basis, and claims may be restricted if fixed rate expenses are claimed too, see Accounting: Cash basis /fixed rate expenses?

Index to key guides

Guide Details

Annual Investment Allowance

What is the Annual Investment Allowance? What are the limits? What expenditure qualifies? 

Dwelling Houses & capital allowances

What is a dwelling house for capital allowance purposes? Can capital allowances be claimed in respect of a dwelling house? What expenditure qualifies?  
Enhanced Capital Allowances: energy saving plant 

What are Enhanced Capital Allowances (ECAs)? What is energy-saving plant and machinery? What allowances are available?  
Enterprise Zones: plant and machinery allowances

What is an Enterprise Zone (EZ)? Enterprise Zones (EZ) are designed to attract new business to their area by offering a package of measures from capital allowances and business rate relief to planning relaxations.

Fixtures: Overview

What are fixtures? How do I claim lost or unclaimed fixtures? When must fixtures be pooled? 
Integral features: At a glance What is an integral feature?
Plant & Machinery allowances What capital allowances are available on plant and machinery? How do you calculate them? What are qualifying activities?
Replacement of domestic items relief What is Replacement of Domestic Items Relief? When can it apply and what conditions must be met? 

Full expensing & First Year Allowances

What is full expensing? When does it apply and what is the rate of allowance? How are disposals of full expensing assets dealt with? What assets qualify for the 50% First Year Allowance (FYA)? How do I deal with disposals of 50% FYA assets? How do I make a claim?
Super-deduction & First-Year Allowances The Super-deduction is no longer available for A/P commencing 1 April 2024.
It is a 130% and a 50% first-year allowance for plant and machinery expenditure incurred by companies between 1 April 2021 and 31 March 2023.
Structures & Building Allowance (SBA)

Provides relief for capital expenditure on non-residential structures and buildings brought into use for qualifying activities.
Wear and tear allowance and renewals basis

These were withdrawn from April 2016. Residential property letting businesses are unable to claim plant and machinery allowances, and these provided an alternative form of relief.  Wear and tear allowance was only available to landlords of furnished properties.


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