Replacement of Domestic Items Relief: How Landlords Actually Claim for Wear and Tear
The old 10% wear and tear allowance was scrapped years ago. Landlords now claim Replacement of Domestic Items Relief instead — but only on genuine like-for-like replacements, not the original purchase. Here is exactly how it works.
From Wear and Tear Allowance to Replacement Relief
Before April 2016, landlords of fully furnished properties could claim a flat 10% Wear and Tear Allowance against rental income, regardless of whether they actually replaced anything that year. This was replaced by Replacement of Domestic Items Relief, a more targeted relief that only allows a deduction when an item is genuinely replaced — removing the ability to claim a flat percentage allowance without any actual expenditure.
This change applies to landlords of furnished, part-furnished, and even unfurnished properties (where applicable items like carpets or curtains might still be provided) — the relief isn't restricted only to fully furnished lets, unlike the old Wear and Tear Allowance.
What Qualifies for the Relief
| Item type | Qualifies? |
|---|---|
| Furniture (sofas, beds, tables, wardrobes) | Yes |
| Furnishings (curtains, carpets, floor coverings) | Yes |
| Household appliances (washing machine, fridge, cooker) | Yes |
| Kitchenware and crockery provided to tenants | Yes |
| Fixtures (fitted kitchen units, fitted bathroom suite, central heating boiler) | No — treated as part of the building, under separate repair/improvement rules |
The Critical Restriction: No Relief on Initial Furnishing
This is the single most important rule to understand: Replacement of Domestic Items Relief only applies to the replacement of an item already in use in the property. The cost of furnishing a rental property for the first time — whether it's a brand-new buy-to-let being furnished from scratch, or an existing property being furnished for the first time as part of switching from unfurnished to furnished letting — is treated as a capital cost, not a deductible revenue expense.
| Scenario | Deductible under this relief? |
|---|---|
| Buying a sofa for a rental property that has never had one before | No — initial cost, capital in nature |
| Replacing a worn-out sofa that was already in the property with a new one | Yes — genuine replacement |
| Replacing a broken washing machine with a new one of similar spec | Yes |
| Buying an additional appliance not previously provided (e.g., adding a dishwasher where none existed before) | No — this is an addition, not a replacement |
The Like-for-Like Rule
If you replace an item with a significantly better, more expensive equivalent, the deduction is capped at the cost of a reasonable modern equivalent of the original item — not the full cost of the upgrade.
Worked example
| Element | Amount |
|---|---|
| Old washing machine (basic model, being replaced) | — |
| Cost of buying a modern equivalent basic washing machine | £280 |
| Cost of the premium washing machine actually purchased | £550 |
| Deductible under Replacement of Domestic Items Relief | £280 (capped at the modern equivalent cost) |
| Additional £270 (the upgrade element) | Not deductible as a revenue expense |
Deducting Disposal Proceeds
If you receive money for disposing of the old item — selling it, trading it in against the new purchase — this must be deducted from the replacement cost before calculating the relief.
Worked example
| Element | Amount |
|---|---|
| Cost of new like-for-like replacement item | £400 |
| Proceeds received from selling the old item | £50 |
| Net deductible amount | £350 |
Fixtures: A Separate Set of Rules
Items permanently fixed to the property — a fitted kitchen, a bathroom suite plumbed in, a central heating boiler — are not "domestic items" for this relief. Their treatment instead depends on ordinary property tax principles:
| Scenario | Typical treatment |
|---|---|
| Repairing/restoring a fixture to its previous condition (e.g., fixing a broken boiler) | Usually deductible as a normal repairs expense against rental income |
| Replacing a fixture with a significantly improved version (e.g., installing a much larger, higher-spec kitchen than before) | Likely treated as a capital improvement, not immediately deductible against rental income (may be relevant for capital gains tax calculations on eventual sale instead) |
Practical Record-Keeping for Landlords
- Keep receipts for both the original item (where possible) and its replacement, to evidence the like-for-like comparison if HMRC queries a claim.
- Record any proceeds received from disposing of the old item.
- Keep a clear distinction in your records between genuine replacements (deductible) and initial furnishing or additions (not deductible under this relief, though may be relevant for capital allowances or CGT calculations in other contexts).
- If uncertain whether a specific item counts as a fixture or a domestic item, or whether a replacement is genuinely like-for-like, consult HMRC's published property income manual guidance or a tax adviser experienced in landlord taxation before submitting a claim.
Frequently asked questions
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