Can I claim installing gas central heating, as well as supplying gas to my rented flat, as a revenue expense or is it a capital expense? The new system has five radiators which have replaced four old electric storage heaters and an electric fan heater in the bathroom.
Arthur Weller replies:
If you take a look at the end of HMRC’s Property Income manual at PIM2020, it states: 'Even if the repairs are substantial…'. It seems to me that replacing a simple electric heater system with a full gas central heating system is an upgrade or improvement and not just a 'like for like replacement'. Therefore, it should be classified as a capital expense and not a revenue expense.