B6.204 Furnished lettings
When a property is let furnished, the landlord's receipts will consist, in part, of a payment for the use of the furniture within the property. Such payments are treated as forming part of the income of the property business1. This means that there is no requirement to apportion any receipt between a rent for the use of the land and the hire of the furnishings.
Similarly, expenses incurred in connection with the provision of the furniture will be allowed (subject to any prohibition) as a deduction from the relevant property business2, though from 1 April 2016 for corporation tax and 6 April 2016 for income tax they must be of a revenue nature. See below for treatment of capital expenditure.
This rule applies, however, only where the use of the furniture is connected with the use of the premises. It does not apply to the extent that the receipts