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Joshua, Lawyer
Category: UK Tax
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Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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Hi, do I have to pay vat on my rental property? If I have to

Customer Question

Hi, do I have to pay vat on my rental property? If I have to pay vat, can I claim it back? Also, I need to renovate the house, should this come from the rental income so that it becomes an allowable expense? Thanks.
Submitted: 2 years ago.
Category: UK Tax
Expert:  Danielle-Mod replied 2 years ago.

Hi, I’m a moderator for this topic and I wonder whether you’re still waiting for an answer. If you are, please let me know and I will do my best to find an Expert to assist you right away. If not, feel free to let me know and I will cancel this question for you. Thank you!

Customer: replied 2 years ago.
Yes, I am still waiting.
Expert:  Danielle-Mod replied 2 years ago.

Sometimes, finding the right Expert can take a little longer than expected and we thank you greatly for your understanding. We’ll be in touch again shortly.

Expert:  Joshua replied 2 years ago.
  1. Could I clarify - vat on what please? The rent itself?
  2. Is this your only rental property?
Customer: replied 2 years ago.
Vat on rent itself, and only one property.
Expert:  Joshua replied 2 years ago.
Thanks. No you do not have to pay any VAT on rental income.

The expenses you can deduct from letting income include:

  • letting agent's fees
  • legal fees for lets of a year or less, or for renewing a lease for less than 50 years
  • accountant's fees
  • buildings and contents insurance
  • interest on property loans
  • maintenance and repairs to the property (but not improvements)
  • utility bills such as gas, water and electricity
  • rent, ground rent, service charges
  • Council Tax
  • services you pay for, such as cleaning or gardening
  • other direct costs of letting the property, such as phone calls, stationery and advertising
Customer: replied 2 years ago.
My accountant said I have to pay vat on my rental income and I cannot pay it back??
Expert:  Joshua replied 2 years ago.
Are you self employed and VAT registered?

If you are then HMRC can consider your rental income for VAT purposes.
Customer: replied 2 years ago.
No, am a pensioner with a property which generates rental income. Hence, I don't understand why I have to pay vat on my rental income.
Expert:  Joshua replied 2 years ago.
In that case I would agree. I suggest you ask your accountant to explain himself thoroughly

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Joshua
Joshua
UK Tax Professional
24527 Satisfied Customers
LL.B (Hons), Higher Prof. Dip. Law & Practice