Landlord allowable expenses 2026/27

Rental profit is rent minus allowable expenses; it goes on the SA105 pages of your tax return. Mortgage interest is the big exception — it is not an expense any more, it is a 20% tax credit. Here is the list.

Allowable against rent

• Letting agent and management fees, tenant-find fees, inventory and check-out costs.
• Repairs and maintenance — fixing, repainting, replacing like-for-like (a new boiler for a broken one, a kitchen of similar standard). Improvements (an extension, a first-time dishwasher) are capital: not deductible against rent, but they reduce capital gains tax on sale.
• Replacement of domestic items — furniture, white goods, carpets, curtains — the cost of a like-for-like replacement, less anything you got for the old item.
• Insurance — buildings, contents, landlord liability, rent guarantee.
• Ground rent, service charges, council tax and utilities that you (not the tenant) pay, including during voids.
• Safety certificates — gas safety, EICR, EPC, legionella, smoke and CO alarms.
• Accountancy, legal fees for renewing leases under 50 years and chasing rent (not for buying the property).
• Travel to inspect or maintain the property at 45p a mile (25p after 10,000 miles).
• Advertising, phone, stationery, software used for the letting business.
• Licensing fees — HMO and selective licensing.

Mortgage interest: the Section 24 tax credit

Since 2020/21, interest and other finance costs (arrangement fees, interest on a loan for the deposit) on residential lets are not deducted from rent. Instead you get a tax reduction of 20% of the finance costs (or of your rental profit, if lower). For a basic-rate taxpayer the result is the same as before; for a higher-rate taxpayer the relief is half what it used to be, and the interest still counts as income when working out your band — which can push you over £50,270 or £100,000 on paper. Furnished holiday lets lost their separate regime in April 2025 and follow the same rules.

What you cannot claim

• The purchase price, stamp duty, and legal fees for buying (capital — kept for CGT).
• Improvements, as above.
• Your own time, and the "wear and tear" allowance (abolished 2016).
• Private use of the property, for example a week you stayed there yourself.

The £1,000 property allowance

If your rental income is under £1,000 you do not need to declare it at all. If it is above, you can choose to deduct a flat £1,000 instead of actual expenses — only worth it if your real expenses are lower.

Making Tax Digital

Landlords with rental plus self-employment income over £50,000 have been in MTD for Income Tax since April 2026 (£30,000 from April 2027): digital records and quarterly updates. See the dates.

Keeping these figures tidy across 1–5 properties is exactly what Plain Tax for Landlords is being built for.

Rates and thresholds for 2026/27, checked against GOV.UK on 20 September 2026. England, Wales and Northern Ireland. Not tax advice.