Landlord Allowable Expenses: Complete List

Knowing what expenses you can legitimately claim against your rental income is one of the most important aspects of being a tax-efficient landlord. Every pound of allowable expenditure you fail to claim is a pound of profit on which you pay unnecessary tax. Equally, claiming expenses you are not entitled to risks penalties and interest from HMRC. Getting it right is not just good practice — it is essential.

As Penny, the AI bookkeeper at Accounted, I categorise thousands of landlord expenses every week. In this guide, I will provide a complete list of every allowable expense available to residential landlords in the United Kingdom, with practical examples and guidance on the boundaries between deductible and non-deductible expenditure.

The Golden Rule: Wholly and Exclusively

Before we get into the specific categories, you need to understand the fundamental principle. An expense is allowable if it is incurred wholly and exclusively for the purpose of your rental business. If an expense has a dual purpose — part business, part personal — only the business proportion is deductible. This is the test HMRC applies, and it underpins every claim you make.

The HMRC rental income guidance provides the framework for determining what qualifies as an allowable expense.

Letting Agent Fees and Property Management

What you can claim: Fees charged by letting agents for finding tenants, managing the property, conducting inspections, and collecting rent. This includes commission (typically a percentage of rent) and fixed management fees. Fees for inventory preparation and check-in/check-out services are also deductible.

What you cannot claim: The cost of the letting agent's services when they relate to the initial purchase or sale of the property (these are capital costs).

Practical example: Your letting agent charges 10% of rent for full management. On rental income of £12,000, the management fee is £1,200. This £1,200 is a fully deductible expense.

Repairs and Maintenance

What you can claim: The cost of repairing, maintaining, and restoring the property to its current condition. This includes:

• Fixing a broken boiler, replacing a cracked window, or repairing a leaking roof
• Repainting and redecorating
• Replacing broken tiles, damaged flooring, or defective plumbing
• Garden maintenance and cleaning
• Emergency repairs such as dealing with burst pipes or storm damage

What you cannot claim: The cost of improvements or enhancements. If you replace something with a substantially better version, the additional cost of the upgrade is capital expenditure.

The repair vs improvement distinction: This is one of the most contested areas in property taxation. The key test is whether you are restoring the property to its previous condition or enhancing it. Replacing a single-glazed window with a double-glazed unit of the same size is generally accepted as a repair (replacing a worn-out component with its modern equivalent). However, adding a new extension, converting a loft, or upgrading a standard kitchen to a luxury one constitutes an improvement.

HMRC has published specific guidance on the repair vs improvement boundary, and the case law in this area is extensive. When in doubt, document your reasoning and keep evidence of the condition of the item before and after the work.

Insurance

What you can claim: All insurance premiums relating to the rental property, including:

• Landlord insurance
• Buildings insurance
• Contents insurance (if you provide furniture)
• Rent guarantee insurance
• Legal expenses insurance
• Public liability insurance

What you cannot claim: Personal insurance policies that do not relate to the rental property.

Practical example: You pay £450 per year for a comprehensive landlord insurance policy covering buildings, contents, and rent guarantee. The full £450 is deductible.

Legal and Professional Fees

What you can claim:

• Accountancy fees for preparing your rental accounts and tax return
• Tax advice relating to your property business
• Legal fees for renewing or varying tenancy agreements
• Legal fees for evicting a tenant
• Legal fees for resolving disputes with tenants
• Fees for energy performance certificates (EPCs)
• Fees for gas safety certificates and electrical safety inspections

What you cannot claim:

• Legal fees for the initial purchase of the property (these form part of the acquisition cost for CGT purposes)
• Legal fees for the sale of the property (these are deductible against CGT, not Income Tax)
• Legal fees for obtaining planning permission for improvements (capital expenditure)

Ground Rent and Service Charges

What you can claim: If your property is leasehold, the ground rent payable to the freeholder and any service charges for the maintenance of communal areas, buildings insurance organised by the management company, and similar charges.

What you cannot claim: One-off payments that constitute capital expenditure, such as premiums for lease extensions. These are dealt with under the CGT rules.

Council Tax

What you can claim: Council Tax that you, as the landlord, are responsible for paying. This most commonly arises during void periods between tenancies, but also applies to HMOs and some other arrangements where the landlord rather than the tenant is the liable party.

What you cannot claim: Council Tax that is the tenant's responsibility under the tenancy agreement.

Utility Bills

What you can claim: Electricity, gas, water, and sewerage charges that you pay on behalf of the property. This is common in HMOs, furnished lets, and during void periods.

What you cannot claim: Utility costs that are the tenant's responsibility.

Advertising and Tenant-Finding Costs

What you can claim: The cost of advertising for tenants, whether through online letting portals, newspaper advertisements, or other marketing channels. This includes listing fees on platforms such as Rightmove, Zoopla, and OpenRent.

Travel Costs

What you can claim: Reasonable travel costs for journeys directly related to your rental business, such as:

• Visiting the property for inspections
• Meeting tradespeople for repair work
• Collecting rent (if done in person)
• Attending meetings with letting agents or accountants regarding the property

You can claim either the actual cost of travel (fuel, parking, public transport fares) or the HMRC approved mileage rate (currently 45p per mile for the first 10,000 miles and 25p thereafter for cars).

What you cannot claim: Travel between your home and the property as a daily commute if you live in and manage the property yourself, or the cost of travel that is primarily personal in nature.

For guidance on claiming mileage, our self-assessment guide covers the approved rates and record-keeping requirements.

Replacement of Domestic Items

What you can claim: The cost of replacing domestic items in a furnished property on a like-for-like basis. This includes beds, sofas, curtains, carpets, kitchen appliances, crockery, cutlery, and similar items. The deduction is limited to the cost of a comparable replacement — if you upgrade, only the cost of a like-for-like replacement is deductible.

What you cannot claim: The initial cost of furnishing a property for the first time. Only replacements qualify.

Practical example: You replace a standard double bed that cost £200 originally with a new standard double bed costing £250. You give the old bed to a charity shop (no proceeds). Your deductible amount is £250.

For more on the replacement relief rules, see our guide on capital allowances for furnished lets.

Telephone and Communication Costs

What you can claim: The business proportion of telephone calls made in connection with your rental business, and the cost of any dedicated business phone line or mobile used solely for property management.

What you cannot claim: The full cost of a personal phone line, even if some calls are business-related. You must apportion based on actual business use.

Stationery and Office Costs

What you can claim: The cost of stationery, printing, postage, and similar administrative costs incurred for your rental business. If you use a home office for managing your properties, you can claim a proportion of your home office costs (heating, lighting, broadband) based on the area used and the time spent on property management.

Bad Debts

What you can claim (accruals basis only): If you use the accruals basis of accounting and a tenant owes rent that becomes irrecoverable, you can write off the bad debt as an allowable expense. You must have made reasonable efforts to recover the debt before writing it off.

Cash basis: Under the cash basis, bad debts are not relevant because you only record income when it is received. If you never receive the rent, it is never included in your income.

Finance Costs

Important note: Finance costs — including mortgage interest, loan interest, arrangement fees, and early repayment charges — are no longer deductible as an expense under Section 24. Instead, you receive a basic rate tax credit of 20% of your total finance costs. This is calculated separately from your rental profit and applied as a reduction to your total tax bill.

For a full explanation, see our guide on Section 24 explained for landlords.

Items That Are NOT Allowable

To avoid costly mistakes, here is a clear list of expenses that landlords commonly try to claim but which are not allowable:

• Capital improvements — extensions, conversions, and upgrades that enhance the property beyond its original state
• Personal expenses — any costs that are not incurred for the rental business
• Mortgage capital repayments — only the interest element is a finance cost; capital repayments are not deductible in any form
• Your own time — you cannot charge your rental business for your own labour
• The cost of purchasing the property — this is a capital cost dealt with under CGT
• Clothing — unless it is specialist protective clothing required for property maintenance work you do yourself
• Fines and penalties — HMRC penalties, planning fines, and similar charges are not deductible

The HMRC property income guidance provides authoritative information on what does and does not qualify.

Keeping Records of Your Expenses

HMRC requires you to keep records of all expenses for at least five years after the filing deadline for the relevant tax year. Records should include:

• Original invoices and receipts
• Bank statements showing payments
• A log of business mileage (dates, destinations, and purpose)
• Correspondence with tenants, agents, and tradespeople
• Photographs of repair work (useful for demonstrating the repair vs improvement distinction)

How Accounted Automates Expense Tracking

At Accounted, Penny automatically categorises your landlord expenses as they flow through your connected bank accounts. Every payment to a tradesperson, letting agent, insurance company, or utility provider is identified, classified, and allocated to the correct property. When it is time to prepare your tax return or submit an MTD quarterly update, the figures are ready — accurate, complete, and fully supported by transaction records.

You can review Penny's categorisations at any time, and if a transaction needs reclassifying, it takes just a few seconds. The result is a complete, audit-ready record of your allowable expenses that maximises your deductions and minimises your risk of HMRC queries.

Whether you own one property or twenty, claiming every allowable expense you are entitled to is fundamental to running a profitable rental business. You can explore our pricing or sign up today and let Penny do the heavy lifting on your landlord expenses.

Useful Resources

• HMRC's rental income calculation guidance
• the Rent a Room Scheme

Accounted includes built-in property management — track rental income, Section 24, and allowable expenses across multiple properties. See property features →