Which allowance should I use - wear and tear or renewals?

Question I let a flat furnished and obviously had to buy all the initial furnishings such as a bed, a sofa and tables. Are these allowable as expenses on my first year’s tax return? If so is their reducing value allowed to be claimed in future using the wear and tear allowance or am I obliged to use the renewals allowance?

Arthur Weller Replies:
There are two ways of claiming capital allowances for furnishings in a fully furnished residential property, the 10% wear and tear allowance, and the renewals allowance. See www.hmrc.gov.uk/manuals/pimmanual/PIM3200.htm. The renewals allowance is not relevant to you at present, because it is only applicable to ‘the net cost of replacing a particular item of furniture etc, but not the cost of the original purchase’.