The Landlord Energy Saving Allowance (LESA) is a tax allowance that enables landlords to claim the cost of buying and installing energy efficient measures against their income or corporation tax. This is up to the value of £1,500 per property.
Energy efficiency is playing an increasingly important role in tenants' letting decisions following the introduction of Energy Performance Certificates for rented properties in October. Landlords are now legally required to make the certificate, which rates the energy performance of a property, available to prospective tenants when they market a property for rent. Failure to do so could result in a £200 fine and the landlord being prevented from marketing the property.
John Heron, Paragon EPCs managing director, said: “Landlords have been forced to take the energy performance of their properties seriously since the EPC requirement came into force. If two properties are of a similar standard and rent level, the tenant is likely to choose the property that is more energy efficient as they will save on heating and electricity bills.
“Therefore, landlords should be keen to improve the energy performance of their properties to make them more attractive to tenants. Landlords already provide high quality rental accommodation, but if they are looking to make improvements to the energy performance of a property, now is a good time and they should also take full advantage of the tax breaks available to them. In the current environment, any cost saving is important.”
Landlords can claim the LESA for draught proofing and loft, floor, cavity wall, solid wall and hot water systems insulation. Landlords must include the expenditure as a deduction in their self-assessment tax return to claim the tax relief. For further information, landlords should visit the www.hmrc.co.uk website.
Paragon EPCs has produced a guide, ‘The Landlords' Guide to EPCs', which includes a full breakdown of the grants and subsidies on offer to help landlords improve the energy performance of their properties. The guide can be downloaded from the www.paragon-epcs.co.uk website, where landlords can also order an EPC for their property.
