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Tax treatment from Property Business in a Company?

I have a company with both UK and Overseas property income. How are these treated for UK tax purposes? What expenses are deductible. If i didnt receive the full rent during the year – how should i account for it?

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    Firstly Property income from all UK situated properties is treated as a SINGLE source of business income for UK tax purposes in a Company- ie everything is pooled together and the net profit/loss is taxed. However overseas property income is NOT lumped together with UK property business, instead overseas property business income is tax treated as “overseas property business” income separately.

    Rental income is taxed on accrual basis ie using accounting methods of accounting and not on cash basis. Hence you time proportion the income even if you had not received it.

    With regards to expenses, UK property business income is treated as business income and hence all expenses incurred Wholly and exclusively for business are deductible. These can include:
    letting agents’ fees
    legal fees
    accountants’ fees
    buildings and contents insurance
    maintenance and repairs to the property (but not improvements)
    utility bills, like gas, water and electricity
    rent, ground rent, service charges
    Council Tax
    services you pay for, like cleaning or gardening
    other direct costs of letting the property, like phone calls, stationery and advertising
    Allowable expenses don’t include ‘capital expenditure’ -however furnished property are allowed to deduct wear and tear allowance which is 10% of the gross rent less any costs you pay that a tenant would usually pay eg Council Tax, rates etc.

    Hope this helps


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