Wear and tear allowance changes

The wear and tear allowance for landlords of furnished properties has been replaced by a new system.

Prior to 6 April 2016, residential landlords of furnished properties could deduct 10% of 'net rental income' (rent less any costs paid by the landlord which are the responsibility of the tenant, e.g. council tax and water rates) from their taxable income to allow for wear and tear).

From 6 April 2016, landlords can only deduct the actual costs incurred of replacing furnishings. The initial cost of purchasing furnishings cannot be deducted from taxable income.