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Landlord's energy saving allowances

The landlord’s energy savings allowance provides a deduction for expenditure on energy saving items against rental income receivable in calculating taxable property income.

Finance Bill 2007 will confirm the extension to the landlord’s energy saving allowance (LESA) which was announced in the 2006 Pre-Budget Report and will apply for qualifying expenditure, such as insulation and draft proofing, incurred on or after 6 April 2007.

From 6 April LESA will be available to corporate landlords who install energy savings items after state aid approval is received.

The annual allowance is £1,500 per property, rather than per building as was previously the case and the LESA will be available for qualifying expenditure up to 2015.