PIM4486 - Property allowance: contents: examples: exclusion of the property allowance when relevant property income comes from a connected firm

Vijay lets out his garage to an unconnected third party in the tax year 2018-19 and collects relievable receipts of £1,000 for the year. Vijay also lets out his driveway to a law firm in which his daughter is a partner and collects receipts of £500 for this.

Vijay’s relevant property income is £1,500. However, as some of this income is from a connected firm, the property allowance is not available to Vijay for 2018-19.

If however, Vijay had only the relievable receipts from letting his garage (to the unconnected third party), he could choose to claim the property allowance, instead of expenses.