Deducting rental costs from rental income
Rental costs can be deducted from rental income from flats or houses. Some expenses can only be deducted in part or not at all. One thing to take into account is the effect of the amount of rent on deductions.
- Deductions from rental income from flats
- Deductions from rental income from houses
- Partially deductible and non-deductible costs
Deductions from rental income from flats
The following costs can be deducted from rental income from flats:
- water bills
- maintenance charges
- capital charges that are recorded as revenue in the housing co-operative’s books
- renovation costs: annual repairs and modernisation costs
- cost of movables
- furnished rentals
- rental losses.
Costs need to be deducted from the income of the year during which they were paid.
Interest on mortgages and letting fees can only be deducted if rent is charged at market value. See also how to deduct interest on buy-to-let mortgages from capital gains.
Deductions from rental income from houses
The following costs can be deducted from rental income from houses:
- water, electricity and gas bills
- real estate tax
- insurance premiums
- buyer’s expenses, i.e. the price paid for the property
- renovation costs: annual repairs and modernisation costs
- cost of movables
- furnished rentals
- rental losses.
Only costs that relate to the let part of a property can be deducted.
Interest on mortgages and letting fees can only be deducted if rent is charged at market value. See also how to deduct interest on buy-to-let mortgages from capital gains.
Partially deductible and non-deductible costs
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