What is the replacement of domestic items relief for landlords?
Answered 11 March 2026
Here is a comprehensive explanation of the Replacement of Domestic Items Relief for landlords.
What the law says
Statutory basis: The relief is found in ITTOIA 2005, s.311A (for individuals/income tax) and CTA 2009, s.250A (for companies/corporation tax). It applies to expenditure incurred on or after 6 April 2016 (income tax) or 1 April 2016 (corporation tax).
Four Conditions (A–D)
The relief applies only when all four conditions are met:
- Condition A: The person carries on a property business in relation to land that consists of or includes a dwelling-house.
- Condition B: (i) A domestic item was already provided for use in the dwelling-house ("the old item"); (ii) the landlord incurs expenditure on a new domestic item ("the new item"); (iii) the new item is provided solely for the use of the lessee; (iv) the new item replaces the old item; and (v) following replacement, the old item is no longer available for use in the dwelling-house.
- Condition C: The expenditure is not prohibited by the wholly and exclusively rule but would otherwise be prohibited by the capital expenditure rule.
- Condition D: No capital allowance under CAA 2001 may be claimed in respect of the expenditure.
Amount of the deduction
- Like-for-like replacement: The deduction equals the full expenditure on the new item.
- Upgrade (not same or substantially the same): The deduction is capped at what it would have cost to replace with an equivalent item.
- Proceeds from disposal of old item: If the old item is sold, the proceeds are deducted from the allowable amount.
What is a "domestic item"?
A domestic item means an item for domestic use (such as furniture, furnishings, household appliances and kitchenware) and does not include fixtures. A fixture means any plant or machinery so installed or fixed in or to a dwelling-house as to become, in law, part of it, and includes any boiler or water-filled radiator installed as part of a heating system.
Exclusions
- No deduction is available where the person has rent-a-room receipts and rent-a-room relief (s.793 or s.797) applies.
- The relief is not available for Furnished Holiday Lettings (FHL) (though note FHL rules were abolished from 6 April 2025, after which replacement of domestic items relief becomes available for former FHL properties).
HMRC guidance / practice
What qualifies as a domestic item: HMRC gives the following examples of qualifying domestic items: moveable furniture (sofas, tables, bed frames), furnishings (curtains, rugs, carpets), household appliances (fridges, freezers, washing machines), and kitchenware (utensils, crockery, cutlery).
What does NOT qualify (fixtures): HMRC gives examples of fixtures that are excluded: baths, washbasins, toilets, and fitted furniture that has become part of the dwelling-house (e.g. built-in wardrobes). The cost of replacing fixtures may instead be deductible as a repair to the building.
Disposal of the old item — worked examples:
- If the old sofa is sold for £100 and a new equivalent sofa costs £600, the deduction is £500.
- If the old fridge is traded in (valued at £300) against a new fridge costing £800, the deduction is £500 (the cash element only; no deduction for the trade-in value).
Interaction with the property allowance: If a landlord uses the property allowance, they cannot also claim replacement of domestic items relief for the same period. It is for the individual to decide each tax year which is more beneficial.
Citation sources
This change will remove the tax advantages that current FHL landlords have received by: applying the finance cost restriction rules so that loan interest cannot be deducted on residential property and only basic rate relief will be available (see PIM2058); removing capital allowances rules for new expenditure (see PIM3010) and allowing replacement of domestic items relief (see PIM3210); withdrawing access to reliefs from taxes on chargeable gains for trading business assets (see CG73500 and
If an individual uses the property allowance they are not allowed to deduct any allowable expenditure from their profits for the same period, including any replacement of domestic items relief (see PIM3210), which would normally have been available in calculating the profit of a property business. It is up to the individual to determine for each tax year whether to use the property allowance or to deduct allowable expenditure, including replacement of domestic items relief.
A domestic item is an item for domestic use such as: Moveable furniture (sofas, tables, bed frames etc) Furnishings (curtains, rugs, carpets etc) Household appliances (fridges, freezers, washing machines etc) Kitchenware (utensils, crockery, cutlery etc) This list is not intended to be complete but gives an idea of the assets that are domestic items and would qualify for ‘Replacement of Domestic Items Relief’. However, fixtures are not domestic items and do not qualify for ‘Replacement of Domest
Where the old item is disposed of for consideration in money or money’s worth (see 3 TC 158 Tennant v Smith), the amount received is deducted from the expenditure on the new asset to get to the amount of the deduction for tax. E.g. a landlord replaces the sofa in their let property. They sell the old sofa for £100 and then buy a new sofa, of equivalent quality/standard, for £600. The amount of the deduction for replacement domestic items would be £500.
Part 3 Property income Chapter 5 Profits of property businesses: other rules about receipts and deductions Deduction for replacement of domestic items Replacement domestic items relief 311A 1 This section applies if conditions A to D are met. 2 Condition A is that a person (“P”) carries on a property business in relation to land which consists of or includes a dwelling-house. 3 Condition B is that— a a domestic item has been provided for use in the dwelling-house (“the old item”), b P incurs exp
Where the old item is traded in as part exchange for a new item, the deduction is equal to the amount expended in excess of the trade in value received. For example, a landlord buys a new fridge costing £800. They trade in the old fridge which is given a value of £300 and meet the rest of the cost with £500 of cash. The amount of the deduction for replacement domestic items would be £500. No deduction is given for the trade in value of the old item.