Claiming every allowable expense is one of the most effective ways to reduce your rental income tax bill legally. Yet HMRC data consistently shows that landlords — particularly those managing their own tax — routinely miss legitimate claims.
This guide covers every category of allowable expense HMRC permits for UK residential landlords in 2025/26, along with the expenses HMRC regularly challenges.
The Basic Rule
HMRC allows you to deduct expenses that are incurred wholly and exclusively for the purposes of your rental business. The expense must be:
- Actually paid (not just invoiced)
- For the rental property — not your personal home or another asset
- Revenue in nature (day-to-day running costs, not capital improvements — see below)
Allowable Expenses: The Full List
1. Mortgage Interest (and Other Finance Costs)
Since April 2020, landlords can no longer deduct mortgage interest directly from rental income. Instead, you receive a 20% tax credit on finance costs — this is known as Section 24.
Finance costs include:
- Mortgage interest
- Loan interest (for funds used to buy, improve, or repair the property)
- Arrangement fees on loans
Note: You cannot deduct the capital repayment portion of your mortgage — only the interest element.
2. Letting Agent Fees and Management Charges
Fully deductible:
- Agent fees for finding tenants
- Monthly management fees
- Renewal and re-letting fees
- Fees for rent collection services
3. Insurance Premiums
You can claim:
- Buildings insurance
- Contents insurance (for furnished lets)
- Landlord liability insurance
- Rent guarantee insurance
- Legal expenses insurance
4. Repairs and Maintenance
This is one of the most valuable — and most scrutinised — categories. You can claim for repairs that restore the property to its original condition, including:
- Repainting and redecorating
- Fixing a broken boiler
- Replacing a like-for-like kitchen (e.g., replacing a fitted kitchen with an equivalent one)
- Repairing a roof
- Replacing broken windows
- Fixing plumbing or electrics
- Garden maintenance
What you cannot claim here: Improvements that add value beyond the original state (e.g., adding an extension, installing a new bathroom where there was not one before). These are capital expenditure — claimable only when you sell the property via Capital Gains Tax.
5. Professional and Legal Fees
Allowable:
- Accountancy fees for preparing rental accounts and tax returns
- Solicitor fees for lease renewals (not for the original purchase)
- Surveyor fees directly related to rental management
- Legal fees for pursuing unpaid rent or eviction proceedings
Not allowable: Legal fees for buying or selling the property (these are capital costs).
6. Property Advertising
Any cost to advertise your property is deductible:
- Rightmove, Zoopla, or SpareRoom listing fees
- Local newspaper advertising
- Photography costs for listings
7. Council Tax and Utility Bills (While Vacant or Included in Rent)
If you pay council tax, gas, electricity, or water on behalf of tenants (included in rent), or during void periods when the property is empty, these are deductible.
8. Service Charges and Ground Rent
For leasehold properties:
- Service charges paid to a management company
- Ground rent
9. Travel Expenses
Travel costs are allowable — but only for trips made wholly and exclusively for rental purposes:
- Travelling to inspect the property
- Travelling to meet contractors or supervise repairs
- The HMRC approved mileage rate (45p per mile for the first 10,000 miles)
You cannot claim for travel if you stopped en route for personal reasons, or if you combined the trip with a personal visit.
10. Stationery, Phone, and Office Costs
A reasonable proportion of:
- Phone costs (the proportion used for rental business)
- Stationery and postage
- Subscriptions to landlord associations (e.g., NRLA)
- Accountancy or property management software subscriptions
11. Replacement of Domestic Items Relief
Since April 2016, landlords of furnished residential properties can claim relief for replacing domestic items — but you cannot claim for the initial purchase. Qualifying replacements include:
- Sofas, beds, and furniture
- Carpets and flooring
- White goods (fridges, washing machines)
- Curtains and blinds
- Crockery and cutlery
The relief is limited to the cost of a like-for-like replacement — if you upgrade (e.g., replace a basic fridge with a range fridge-freezer), you can only claim the cost of an equivalent basic replacement.
What You Cannot Claim
- Capital improvements — extensions, loft conversions, adding a new bathroom (claim on disposal via CGT instead)
- Personal expenses — even if you visit the property for both personal and business reasons
- Mortgage capital repayments — only the interest qualifies (and only as a 20% credit)
- Your own labour — if you do repairs yourself, you cannot charge for your time
- Expenses for a property not yet let — pre-letting expenses are generally not allowable (though legal costs for the original purchase may be offset against CGT)
- Fines and penalties — e.g., fines for breaches of tenancy regulations
The Importance of Good Records
HMRC can investigate up to six years of records for innocent errors — and up to 20 years in cases of deliberate non-compliance. You must keep:
- Receipts for every expense claimed
- Bank statements showing income received
- Tenancy agreements
- Mortgage statements (to confirm interest payments)
With MTD coming in April 2026, digital record-keeping is no longer optional for many landlords — it is a legal requirement. Good software will make keeping these records almost automatic.
Worried you might be missing valid expense claims? Our landlord accountancy service includes a full review of your expenses to make sure you are claiming everything you are entitled to. Get a quote or contact us today.