Can landlords claim tax relief on replacement flooring?

Often, yes. HMRC guidance lists carpets and floor coverings as domestic items, so replacing them in a residential let can qualify for replacement of domestic items relief. The relief covers replacements, not the first purchase, and if the new floor is an upgrade, only the cost of a like-for-like equivalent counts.

This article summarises what HMRC’s published guidance says about replacement flooring in let residential property. It is general information, not tax advice. Your circumstances, the type of let and the exact work all matter, so speak to your accountant before you rely on any of it.

What is replacement of domestic items relief?

Replacement of domestic items relief was introduced for expenditure from 6 April 2016 for Income Tax and 1 April 2016 for Corporation Tax. HMRC’s Property Income Manual (PIM3210) says it “allows a deduction for the replacement (not initial purchase) of certain domestic items”. It sits in the legislation at ITTOIA 2005 section 311A and CTA 2009 section 250A.

HMRC sets four conditions:

1. You carry on a property business that includes letting a dwelling-house.
2. An old domestic item provided for use in the dwelling-house is replaced with a new one, provided for the tenant’s exclusive use, and the old item is no longer available to them.
3. The spend passes the “wholly and exclusively” test but would otherwise be blocked as capital expenditure.
4. Capital allowances have not been claimed on the new item.

The GOV.UK guidance confirms the relief can be claimed whether the property is let unfurnished, part furnished or fully furnished.

Do carpets and floor coverings count as domestic items?

HMRC’s manual gives “furnishings (curtains, rugs, carpets etc)” as examples of domestic items. The GOV.UK guidance for landlords goes a step further and lists “furnishings for example curtains, linens, carpets, floor coverings”.

What does not qualify is a fixture. PIM3210 defines fixtures as plant or machinery “installed or fixed in or to a dwelling-house such that it becomes part of that dwelling-house”, with examples such as baths, washbasins, toilets and built-in wardrobes. HMRC says replacing a fixture may instead be an allowable repair to the building, as long as it is like-for-like and not an improvement, and not the replacement of an “entirety”.

HMRC’s guidance does not single out laminate, LVT or sheet vinyl by name. Whether a particular floor is treated as a floor covering or as part of the building is a question to put to your accountant, especially for floors that are glued down or were part of the original construction.

Like-for-like replacement or an improvement?

This is where most of the detail sits. If the new item is broadly the same quality and standard as the old one, the deduction is the cost of the new item. HMRC is clear that being brand new does not make something an improvement over an item that has been in use for years.

If the new item is an improvement, the deduction is limited to what a like-for-like replacement would have cost. The GOV.UK guidance gives a flooring example directly: upgrading “from synthetic fabric carpets to wool carpets” counts as an improvement. A change of function, or an upgrade in quality or material, also counts.

A reasonable modern equivalent is not an improvement. HMRC’s example is a fridge with a better energy rating. PIM2030 makes the same point for repairs to the building: where any improvement arises only because new materials are broadly equivalent to the old, the cost normally remains revenue expenditure. It also notes that capital and repair work done at the same time can be apportioned, and that an apportionment in the contractor’s bill may provide a sensible basis, provided it is done fairly.

In practice, an itemised quotation that separates materials, underlay, fitting and uplift for each room makes these conversations with your accountant much easier. See what a flooring quotation should include.

Can you claim fitting and removal of the old floor?

PIM3210 says the deduction is increased by incidental capital expenditure connected with disposing of the old item or buying the new one. HMRC’s examples are delivery, installation and disposal of an old oven. Any money received for the old item, for example if it is sold, is deducted. How that applies to carpet fitting, underlay and uplift on your job is one to confirm with your accountant. Our guide to who removes old flooring explains how uplift and disposal are usually handled on a quotation.

What is not covered?

According to HMRC guidance, the relief is not available:

• For the initial purchase of domestic items, for example carpeting a property for its first let. GOV.UK treats buying furnishings and equipment for a property as capital.
• Where Rent-a-Room relief has been claimed on receipts for that dwelling-house.
• Where capital allowances have been claimed on the new item.

The GOV.UK guidance also notes that if you keep part of a tenant’s deposit to cover damage, you can only claim repair expenses above the amount you kept. If a damaged carpet is being replaced at the end of a tenancy, mention any deposit deduction to your accountant. Our article on how long carpet should last in a rental explains how deposit schemes apportion those deductions.

What about furnished holiday lets?

PIM3210 says the relief is not allowed where the dwelling-house is, in full or part, a furnished holiday letting. However, HMRC’s manual (PIM3205 and PIM3210) now also states that the furnished holiday lettings rules cease to apply for tax years beginning on or after 6 April 2025 for Income Tax and Capital Gains Tax, and from 1 April 2025 for Corporation Tax. If you have run a holiday let under the old regime, particularly one where capital allowances were claimed on furnishings, ask your accountant how the change affects replacement flooring.

What happened to the 10% wear and tear allowance?

Before April 2016, landlords of fully furnished lets could elect for a wear and tear allowance of 10% of net rents, which HMRC’s PIM3215 says covered items including “carpets and floor-coverings”. It applied up to 2015-16 and has been replaced by the domestic items relief described above.

Common questions

Can I claim for carpeting a rental property for the first time?

Not under replacement of domestic items relief. HMRC says the relief covers replacement, not initial purchase. GOV.UK advises keeping records of capital expenses, as some may be relevant for Capital Gains Tax when the property is sold.

If I replace cheap carpet with a better one, can I claim anything?

HMRC guidance says you can claim the cost of an equivalent like-for-like replacement, but not the extra for the upgrade. Ask your supplier to price the like-for-like option so your accountant has the figure.

Does the property need to be let furnished?

No. GOV.UK states the relief can be claimed for unfurnished, part furnished and fully furnished dwelling-houses.

What records should I keep?

GOV.UK says to keep receipts, invoices and bank statements for at least five years after the 31 January filing deadline for each tax year. A dated, itemised invoice for each property is the most useful record for flooring.

Is this tax advice?

No. It summarises HMRC’s published guidance as general information. Tax treatment depends on your own circumstances, so speak to your accountant.

Replacing flooring between tenancies?

We supply and fit carpet, sheet vinyl, laminate and LVT for landlords and letting agents across Burton-on-Trent, Branston and Swadlincote. See our landlord flooring page, or send the property details through the quote form for an indicative estimate or written quotation, itemised by room for your records.