Legal, management and other professional fees (property)
for landlords

Legal, management and other professional fees is box 27 on the UK property pages. It covers letting agents' management fees for rent collection, advertising and administration, accountants' fees, legal fees for short lets and lease renewals under 50 years, and professional fees to evict a tenant so you can let again. Costs of buying, selling or first letting a property on a long lease are not included.

What goes in this category

• Letting agent management, rent collection and tenant-find fees.
• Accountant’s fees for the letting business.
• Legal fees for lets of a year or less and lease renewals under 50 years.
• Professional fees to evict a tenant in order to re-let, and to appeal a compulsory purchase order.

What does not

• Costs of the first letting of a property for more than a year.
• Costs of agreeing and paying a premium on renewal of a lease.
• Planning permission fees and title registration on purchase.
• Legal and agent fees for buying or selling property.

Items in this category

Letting agents

Management fees, tenant-find fees, inventories and referencing are allowable. Agents usually deduct fees from the rent they pass on, so declare the gross rent and claim the fees. Since the Tenant Fees Act 2019 in England, landlords pay most set-up costs that tenants used to.

Legal fees

Legal fees for a let of a year or less, for renewing a lease of less than 50 years, and for evicting a tenant to re-let are allowable. The first grant of a lease of more than a year is capital, as are legal fees on buying the property and extending your own lease.

Accountants

Accountants' fees for the letting business are allowable, including preparing figures for the property pages and Making Tax Digital updates. If the same accountant deals with other income, split the fee reasonably.

Surveyors and valuers

Surveys for repairs, such as a damp survey on a let property, are allowable. Surveys and valuations for buying or selling, or for a remortgage, follow the treatment of the transaction: capital, or a finance cost for a loan valuation.

Evictions and disputes

Professional fees for evicting a tenant so you can re-let are allowable, as are costs of recovering unpaid rent. Fees for disputes about the ownership of the property, or its boundaries, are more likely to be capital.

Fee protection insurance

Tax investigation or fee protection insurance is usually not allowable, because it covers the costs of enquiries that find careless or deliberate errors, which would not be allowable themselves.

Planning and building control

The SA105 notes exclude planning permission fees and title registration on purchase. Planning and building control fees for improvement work are part of the improvement's capital cost.

One total if income is under £90,000

If your total property income before expenses is below £90,000, the SA105 notes let you add up your expenses, excluding residential finance costs, and put the total in box 29 instead of splitting them between boxes 24 to 29. You still need the underlying records, and the costs that belong in box 27 are still only those allowable under the same rules. Making Tax Digital quarterly updates follow the same £90,000 threshold for a single expenses figure.

Managing agents for blocks

If a managing agent for your building charges you directly for management rather than through the service charge, the fee is allowable here.

Records to keep

Keep agent statements, accountant and solicitor invoices, and a note of what each legal fee was for. The purpose of a legal fee decides whether it is allowable, so a vague invoice is hard to defend.

Worked example: professional fees for two lets

A landlord pays £2,400 in management fees, a £500 tenant-find fee, £450 to her accountant and £1,200 in legal fees to evict a tenant who stopped paying so she could re-let. Box 27 is £4,550. The £1,900 in legal fees on buying a third property is part of its cost.

Four questions before a cost goes here

1. Was it for the letting, and only for it? A cost must be incurred wholly and exclusively for the property business. A cost with a personal purpose that cannot be separated is not allowable at all.
2. Is part of it personal? Where a business part can be identified, such as business miles or business calls, claim that part on a reasonable basis and leave the rest out.
3. Is it a running cost or something you keep? Running costs belong in the expense categories. Buying or improving the property is capital and never goes here, though replacing domestic items has its own relief.
4. Is there a specific rule? Some costs are disallowed whatever their purpose, such as fines and client entertaining, and some have their own treatment, such as residential finance costs, which give a 20% tax reduction instead of a deduction.

Jointly owned property

If you own a let property with someone else, each owner reports their share of the rental income and expenses. Married couples and civil partners who live together are usually taxed on equal shares; if you own the property in unequal shares and are entitled to the income in the same shares, you can be taxed on that basis once you declare your beneficial interests to HMRC. Owners who are not married or in a civil partnership usually split profits by their share of the property, unless they agree a different allocation.

Property allowance or expenses

Instead of deducting expenses, a landlord can claim the £1,000 property allowance, which is simply taken off rental income. You cannot claim both for the same income, so the allowance only helps if your allowable expenses are less than £1,000. If your gross property income is £1,000 or less, the allowance covers it and you may not need to report it. Either way, keep records of what you spent, so you can tell which gives the lower profit.

This category in Making Tax Digital

Under Making Tax Digital for Income Tax, a landlord's quarterly update carries the same property expense categories as the UK property pages of the return, so this category is one line of each update. Landlords with property income only, or with property and trading income together over £50,000, join from 6 April 2026, falling to £30,000 from April 2027 and £20,000 from April 2028. If your property income is under £90,000 you can send a single consolidated expenses figure instead of the categories, but you still need the underlying records.

Cash basis or traditional accounting

Which accounting basis you use changes when a cost in this category counts, and sometimes whether it counts as an expense. On the cash basis, now the default, you deduct costs when you pay them and most things you buy to keep are ordinary expenses (cars being the exception). On traditional accounting, you deduct costs when you incur them and claim capital allowances for things you keep.

Residential finance costs are different

Since 6 April 2020, mortgage interest and other finance costs on residential lets are not deducted from rental income at all. Instead, you get a tax reduction of 20% of those costs, which is worth the same as a deduction to a basic-rate taxpayer and less to a higher-rate one. Finance costs for commercial and other non-residential lets are still deducted in full. That is why the property pages have a separate box (44) for residential finance costs.

How much an allowable cost saves

Landlords pay Income Tax on rental profit but no Class 4 National Insurance, so each pound of allowable expense saves 20p at the basic rate, 40p at the higher rate and 45p at the additional rate. Residential finance costs are the exception: they give a flat 20% tax reduction instead of a deduction.

What £1,000 of allowable expense saves a sole trader in 2026/27

• Basic rate (20% + 6%)£260
• Higher rate (40% + 2%)£420
• Additional rate (45% + 2%)£470
• Allowance taper band (60% + 2%)£620

Records to keep

Keep the invoice or receipt for every cost in this category, with a note of the business purpose wherever it is not obvious, and how you worked out the business share of anything also used privately. From 6 April 2026, sole traders and landlords with qualifying income over £50,000 keep digital records and send quarterly updates under Making Tax Digital, falling to £30,000 from April 2027 and £20,000 from April 2028.

Common mistakes

• Claiming purchase legal fees here.
• Declaring rent net of agent fees.
• Claiming fee protection insurance.

Every other category

The other 7 categories on the UK property pages, in box order:

• Rent, rates, insurance and ground rents (property), SA105 box 24
• Property repairs and maintenance, SA105 box 25
• Non-residential property finance costs, SA105 box 26
• Costs of services provided, including wages (property), SA105 box 28
• Other allowable property expenses, SA105 box 29
• Travel costs (property), SA105 box 29
• Residential property finance costs, SA105 box 44

The A to Z of expenses lists every item and all 23 categories: the 15 self-employment categories and the 8 for UK property.