The same £9,000 is worth £3,600 now or £2,160 later
Repair or Improvement Checker
A repair comes off this year’s rent at your marginal rate. An improvement joins the base cost and waits for the sale, relieved at 24 per cent.
Repair or Improvement Checker
A repair comes off this year's rent. An improvement waits until you sell, which may be decades away.
Where the line actually falls
Replacing something with the modern equivalent is a repair. Single glazing to double glazing is a repair, because double is what you can buy now. A kitchen for a better kitchen in the same place is a repair.
Adding something that was not there is an improvement. An extension, an extra bathroom, a converted loft.
Work needed to make a property lettable at the point you bought it is capital, however much it looks like repairing. The price you paid reflected the state it was in.
Improvements are not lost. They add to the base cost and reduce the gain when you sell, but that relief may be years away and it is at 18 or 24 per cent rather than your income tax rate.
Take the workbook
The tests, and the cash difference between deducting now and waiting for the sale.
Download the workbookFAQs
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