What Can I Deduct as a UK Landlord? The Complete 2026 Guide

This guide covers every allowable deduction for the 2025/26 and 2026/27 tax years. Bookmark it. Refer to it when you file.

The Two Types of Deductions

Revenue expenses: Day-to-day costs of running your rental. Deductible against rental income.

Capital allowances: Purchase of assets (fixtures, fittings, equipment). Deducted via capital allowance claims, not as revenue expenses.

Most landlords focus only on revenue expenses. The missing capital allowances are where significant deductions are lost.

Section 1: Revenue Expenses (Day-to-Day Costs)

Mortgage Interest with Section 24 Restrictions

This is the big one. Here is how it works:

• Basic rate taxpayers (20%): Full mortgage interest is deductible
• Higher rate taxpayers (40%): Only 20% relief on mortgage interest
• Additional rate taxpayers (45%): Only 20% relief on mortgage interest

Property Repairs and Maintenance

Deductible (repairs):

• Fixing a broken boiler
• Repairing damaged walls or ceilings
• Replacing worn-out items (not improvements)

NOT deductible (improvements):

• Adding a new bathroom where none existed
• Extending the property
• Installing a new kitchen (replacing like with like is usually a repair)

The distinction between repair and improvement is one of the most disputed areas of landlord tax. When in doubt, ask a specialist.

Insurance

Deductible: Buildings insurance, landlord insurance, contents insurance (if you provide furnishings).

Not deductible: Life insurance, mortgage payment protection.

Agent Fees

Letting agent fees are deductible. This includes:

• Initial letting fee
• Ongoing management fee
• Renewal fees

Typically 8 to 12% of rental income for full management.

Legal and Professional Fees

Deductible:

• Tenancy agreement drafting
• Rent recovery legal costs
• Eviction costs (if unsuccessful in recovering rent)

Not deductible:

• Legal fees for purchasing the property (capital, not revenue)
• Accountancy fees for tax return preparation (actually deductible, but many miss this)

Accountancy Fees

Yes, you can deduct the cost of having your tax return prepared. This is often missed. Use a property tax specialist, not a general accountant. The fee is deductible.

Cleaning

Deductible:

• Professional cleaning between tenancies
• Regular cleaning for HMOs (houses in multiple occupation)

Not deductible: Your own labour.

Utility Bills

Deductible if you pay them: Gas, electricity, water (if included in rent), council tax (if you pay it for the property).

Other Deductible Expenses

• Advertising for new tenants
• Telephone and broadband (property-related proportion)
• Stationery and postage
• TV licence (property-related proportion, if applicable)

Section 2: Capital Allowances

Capital allowances are a separate deduction from revenue expenses. They apply to capital expenditure on fixtures and fittings.

Section 3: What You Cannot Deduct

• Personal expenses (your own rent, mortgage on your home)
• Capital repayment of mortgage
• Improvements (as opposed to repairs)
• Legal fees for purchasing the property
• Traffic fines
• Expenses not related to the rental

Section 4: Section 24, The Critical Context

Section 24 restricts how much mortgage interest higher and additional rate taxpayers can deduct.

How it works:

• Before Section 24: Deduct full mortgage interest, get full tax relief at your rate
• After Section 24: Get only 20% tax relief, rest is a basic rate reduction

Section 5: The Most Missed Deductions

Based on common errors:

1. Accountancy fees — Usually missed
2. Capital allowances on fixtures — Rarely claimed correctly
3. Legal fees for tenancy agreements — Missed
4. Professional cleaning between tenancies — Often missed
5. Section 24 restriction calculation — Almost always wrong

How to Claim