June 04 Property Letting Question - Any Ideas?
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Hi
I have just done June 04 task 1.1 and I would appreciate some help please.
The questions states that the house is rented from 1 JULY until 5 April. ie. 9/12 year. It also states that insurance is paid from 1 JUNE until 5 April at a cost of £450.
We deal with the income on a pro rata basis, but what do we do with the insurance? It is paid for 10 months of the year but is only matched with income for 9 months.
I personaly used 9/10 of £450 as an expense however the answers the AAT provide have included the whole £450! Are they wrong or is it me?
Thanks in advance.
I have just done June 04 task 1.1 and I would appreciate some help please.
The questions states that the house is rented from 1 JULY until 5 April. ie. 9/12 year. It also states that insurance is paid from 1 JUNE until 5 April at a cost of £450.
We deal with the income on a pro rata basis, but what do we do with the insurance? It is paid for 10 months of the year but is only matched with income for 9 months.
I personaly used 9/10 of £450 as an expense however the answers the AAT provide have included the whole £450! Are they wrong or is it me?
Thanks in advance.
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Comments
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Re:June 04 Property Letting Question - Any Ideas?
Hi
I know the question you're on about - the £450 is the correct answer.
I use Osborne Books and it says: 'Expenditure that satisfied the rules (i.e. allowable' and is incurred before the premises are rented out or in periods in between rental periods ('void' periods) is also generally alllowable'.
Hope that helps.
Good Luck Friday (I'm going to need it!).
Vicky0