Replacement of furnishings and equipment

Replacement of Domestic Items Relief

This relief provides a deduction for the cost of replacing items of furniture or equipment when computing the taxable profit, subject to several conditions:

• ‍The person claiming the deduction must have a property business that includes a dwelling house
• The item being replaced must be available for the exclusive use of the tenant
• The replacement is on a “like for like” basis with no element of improvement.

The “like for like” restriction means that where a replacement item includes an element of improvement then only part of the cost is allowable. The part that is allowable is what the cost would have been on a like for like basis (i.e.: with no improvement element).

As with the previous allowance, there is no allowance for the initial furnishing and equipment in a property.

These rules do not apply to a furnished holiday letting where capital allowances are available.

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