1. Property Maintenance and General Repairs
Maintenance is often the largest recurring cost for a landlord. The good news is that most of these costs are fully deductible. However, you must distinguish between a repair and an improvement.
A repair restores the property to its original condition (e.g., fixing a broken window, repairing a leaking roof, or redecorating between tenancies). These are allowable expenses. An improvement (e.g., adding an extension or installing a luxury kitchen where a basic one existed) is considered a capital expenditure and is generally not deductible from your rental income, though it may reduce your Capital Gains Tax when you sell.
Common deductible repairs include:
- Fixing electrical faults or plumbing issues.
- Treating damp or rot.
- Repainting and re-plastering.
- Replacing broken roof tiles.
2. Letting Agent and Management Fees
If you use a letting agent to manage your property or simply to find and vet tenants, their fees are 100% tax-deductible. This includes full management percentages, let-only fees, and administrative charges for inventory checks or tenancy agreements.
Using an agent can save you significant time, and knowing that HMRC effectively “subsidises” this cost through tax relief makes it a much easier pill to swallow for busy landlords.
3. Comprehensive Landlord Insurance
Standard homeowners’ insurance usually won’t cover you if you are renting out your property. You need specific landlord insurance, and the premiums are fully deductible. This includes:
- Buildings insurance.
- Contents insurance (for furnished lets).
- Public liability insurance.
- Loss of rent insurance (which covers you if the property becomes uninhabitable).
Protecting your investment is a business necessity, and ensuring these premiums are recorded correctly in your bookkeeping is vital for your year-end filing.
4. Mortgage Interest (The 20% Tax Credit)
It is a common misconception that you can deduct your full mortgage payment. You cannot deduct the capital repayment element of your mortgage. Furthermore, since the “Section 24” changes, you can no longer deduct mortgage interest directly from your rental income to reduce your taxable profit.
Instead, you receive a 20% tax credit on your mortgage interest payments. While this is less beneficial for higher-rate taxpayers than the old system, it is still a significant relief that you must claim. Keeping accurate records of the interest portion of your monthly payments is essential.
5. Professional Fees for Compliance
In 2026, the complexity of property tax means that trying to DIY your accounting can lead to expensive mistakes. Professional fees related to your property business are deductible. This includes:
- Accountancy fees: The cost of preparing your rental accounts and MTD filings.
- Legal fees: Specifically for tenancies of less than a year or for lease renewals. (Note: Legal fees for the initial purchase of the property are capital costs, not revenue expenses).
- Bookkeeping services: Keeping your records digital and compliant.
6. Travel and Mileage Expenses
Do you drive to your rental property for inspections? Do you head to the DIY store to pick up supplies for a repair? Those miles add up.
You can claim 45p per mile for the first 10,000 miles in a tax year (and 25p thereafter) for business-related travel. The key here is documentation. HMRC requires a mileage log showing the date, the reason for the trip, and the distance covered. You cannot claim for “commuting” to an office, but travel between your home and your rental properties is generally permitted as long as the primary purpose is business.
7. Administrative and Office Costs
Even if you manage your properties from your kitchen table, you are running a business. Many small administrative costs are deductible:
- Phone calls related to the property.
- Stationery and postage.
- Advertising for new tenants (online portals, local papers).
- Software subscriptions for property management or bookkeeping.
While these might seem like small amounts, they add up over a year. Using a dedicated business bank account and digital tools makes tracking these “micro-expenses” much easier.
8. Utility Bills and Council Tax
Generally, the tenant pays the utility bills. However, there are times when the landlord is responsible:
- During void periods when the property is empty.
- In “bills included” HMO (House in Multiple Occupation) setups.
- Council tax during periods when the property is vacant between tenancies.
If you pay these costs directly to the provider, ensure you keep the invoices. They are a legitimate business expense that reduces your taxable profit.
9. Safety Checks and Mandatory Certificates
The UK government has strict regulations regarding tenant safety. Staying compliant isn’t optional, but at least the costs are deductible. You can claim for:
- Annual Gas Safety Checks (CP12).
- Electrical Installation Condition Reports (EICR).
- Energy Performance Certificates (EPC).
- Fire safety equipment and inspections.
Failure to keep these up to date can lead to massive fines, so consider these “must-have” expenses for your business.
10. Replacement of Domestic Items Relief
If you rent out a furnished or part-furnished property, you cannot claim for the initial cost of buying furniture. However, you can claim Replacement of Domestic Items Relief when you replace an existing item.
This covers:
- Furniture (sofas, beds, wardrobes).
- Household appliances (fridges, washing machines, microwaves).
- Floor coverings (carpets, rugs).
- Curtains and linens.
The replacement must be on a “like-for-like” basis. If you replace a basic fridge with a high-end smart fridge, you can only claim the cost of a basic equivalent.
Navigating Making Tax Digital (MTD) in 2026
By now, most UK landlords are fully aware of Making Tax Digital for Income Tax Self Assessment (ITSA). If your total property and business income is above the threshold, you are required to maintain digital records and file quarterly updates with HMRC.
