Landlord Tax Returns: What to Declare and Which Expenses You Can Claim

20 October 2026

If you rent out a property as an individual, you declare your rental income on the UK property pages of your Self Assessment return. You add up the rent and related charges you received in the tax year, take off your allowable running costs, and pay Income Tax on what is left. Mortgage interest is handled separately, as a tax reduction at the basic rate rather than as an expense. For the 2025 to 2026 tax year, the online return and any tax owed are due by 31 January 2027.

This guide is for individual landlords letting residential property in the UK. It does not cover property held in a limited company, and it does not cover the quarterly updates under Making Tax Digital, which we explain in our Making Tax Digital for Income Tax guide. The rules below are as HMRC's guidance stood when we checked it in September 2026.

Do landlords need to file a Self Assessment tax return?

It depends on how much you receive. According to GOV.UK:

The first £1,000 of property income is tax-free under the property allowance.
If your income from property is more than £1,000 and up to £2,500 a year, you contact HMRC rather than filing a return.
If it is more than £2,500 after allowable expenses, or more than £10,000 before expenses, you need to complete a Self Assessment return.

If you have never filed before, you must register by 5 October after the end of the tax year in which you had the rental income. Our post on who needs to file a Self Assessment tax return covers the other reasons you might need to file.

What counts as rental income?

Rental income is more than the rent itself. HMRC counts:

the rent your tenants pay
payments for the use of furniture
charges for services you provide, such as cleaning communal areas, hot water, heating or repairs

If you own the property jointly, you declare only your share. Married couples and civil partners who live together are usually taxed in equal shares. Other joint owners are usually taxed according to the share of the property each one owns.

Which expenses can landlords claim?

You can deduct costs spent wholly on running the let. HMRC's list of allowable expenses includes:

general maintenance and repairs
water rates, council tax, gas and electricity, where you pay them
landlord insurance
letting agent and management fees
legal fees for lets of a year or less, or for renewing a lease for less than 50 years
accountant's fees
ground rent and service charges
direct costs such as phone calls and advertising for tenants
vehicle running costs for travel to manage the property

Most individual landlords with receipts of £150,000 or less use the cash basis by default, which means you count income when you receive it and expenses when you pay them. You can choose the traditional (accruals) basis instead if it suits you better. See HMRC's property income manual for the detail.

Repairs or improvements: the line that matters most

HMRC treats repairs and improvements differently, so the distinction affects what you can claim. A repair restores something to its original condition, sometimes by replacing parts of it. Fixing a leaking roof, repainting between tenants or replacing a broken window with a similar one are repairs, and you can claim them.

An improvement makes the property better than it was. An extension, a loft conversion or turning a basic kitchen into a much higher-spec one is capital spending. You cannot deduct it from your rental income, although it may reduce the gain when you sell.

If a job is partly a repair and partly an improvement, get advice before you put it on the return. HMRC does check these claims, and our guide to HMRC compliance checks explains what that involves.

Replacing furniture and appliances

Replacing furniture and appliances has a separate relief. Under replacement of domestic items relief, you can claim the cost of replacing items such as beds, sofas, carpets, curtains, white goods and kitchenware in a let dwelling, where a new item replaces an old one. It does not cover the first purchase of an item for the property, only its replacement.

How mortgage interest is treated

Individual landlords of residential property cannot deduct mortgage interest from rental income. Since 6 April 2020 the relief has been restricted to the basic rate of Income Tax.

Instead, you get a tax reduction worth 20% (the basic rate) of the lowest of three figures:

your finance costs for the year, plus any carried forward
your property profits for the year
your adjusted total income above your Personal Allowance

Only the interest part of a mortgage payment counts, not the capital repayment. Finance costs also include interest on loans to buy furniture for the let and fees for taking out or repaying those loans. If the reduction is capped by your profits or income, the unused amount carries forward to later years.

For higher-rate taxpayers, relief at 20% is less than the tax paid on that income, so the bill can be higher than they expect. It is also one reason the choice of who owns a property, and in what shares, needs thinking through. Our tax planning service covers this for landlords.

Can you use the property allowance instead?

If your expenses are low, you can use the £1,000 property allowance instead of claiming actual expenses. You cannot claim both. Joint owners can each use the allowance against their own share of the gross rent. You cannot use it on income where you claim the finance cost tax reduction, so if you claim that reduction you need to claim actual expenses instead.

What about losses?

If your allowable expenses are more than your rental income, you make a loss. Normally you can only set that loss against future profits from the same rental business. You cannot set it against your salary or other income, so keep a note of it and make sure it is carried forward each year.

Records to keep

Keep records of all rent received, every expense and the invoices behind it, mortgage statements showing the interest charged, and letting agent statements. The landlord section of our Self Assessment checklist lists the documents to gather before you start.

Deadlines for the 2025 to 2026 return

31 October 2026: paper returns
30 December 2026: online returns, if you already pay tax through PAYE, owe less than £3,000 and want it collected through your tax code
31 January 2027: online returns and payment of any tax owed, plus your first payment on account for 2026 to 2027 if one applies

Getting your landlord tax return right

If you would like someone to prepare your property pages, check your expense claims and look at how your rental income is structured, speak to George Isaacs. Get in touch to arrange a free consultation.

Frequently Asked Questions

Can I claim the cost of a new kitchen in my rental property?

It depends on what the work does. Replacing parts of a kitchen to restore it to its original condition is a repair, even if the new parts are modern equivalents. Replacing it with a higher-specification kitchen is capital spending, which you cannot deduct from rental income.

Can I deduct my mortgage payments from my rental income?

No. Individual landlords of residential property cannot deduct mortgage interest as an expense. You get a tax reduction worth 20% of the interest instead, subject to limits, and capital repayments do not count at all.

Do I need to declare rental income under £1,000?

No. The first £1,000 of property income is covered by the property allowance. If you receive more than £1,000 and up to £2,500, you contact HMRC. Above that, you file a Self Assessment return.

How do joint owners split rental income?

Married couples and civil partners who live together are usually taxed on half each. Other joint owners are usually taxed according to the share of the property they each own.

What happens if my expenses are more than my rent?

You make a loss for the year. You can normally only use it against future profits from the same rental business, so it should be carried forward on your return.