- August 30, 2021 at 5:02 pm #633553ictiancrisMember
- Topics: 10
- Replies: 3
Hi! I was attempting an exam and got wrong in this question, and I feel like I should be correct on this though…
Here is the question:
Vicky owns and rents out several properties. The following information is available for the tax year 2020/21.
The Blue House (furnished)
Annual rent £12,000
Allowable costs £4,000
Mortgage payment £2,500 (of which £1,000 was interest)
Replacement of a dining table and chairs. The new table has six chairs and cost £650. The old table had four chairs and a similar table and chairs would now cost £500.
The property was let for the whole of 2020/21.
The Green House
Annual rent £15,000
Allowable costs for the let period £3,625
Redecoration costs £3,500
Mortgage interest £1,500
The property was let from 1 November 2020. The rent was payable monthly in advance on the first day of each month.
The Red House
This house is fully furnished, was available for let all year and was let for 48 weeks in 2020/21.
Weekly rental £850
Allowable costs in the rental period £13,120
Mortgage interest £800
My Answer of Tax Credit is 660 ((800+1000+1500) @ 20%), and somehow its wrong? Can someone help me please? I’m confused!
The Correct Answer is: £500
(Speculation: Is it because of the furnished holiday letting, hence the 800 is not included?)
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