My wife and I purchased a residential property in 2005 that needed full refurbishment, including replacing lintels from wood to concrete, as it had subsidence; removing and replacing plaster; new windows; bathroom; kitchen; new roof; new bricks as a lot of old ones had perished; new drive and garden, etc. Would some or all of the above be allowable for capital gains tax (CGT) purposes when we sell the property? 

Arthur Weller replies:  

Yes, some of the things you have listed would be allowable for CGT purposes. See HMRC’s Property Income Manual at PIM2030 (sections headed 'Extensive alterations to a property' and 'Capital work and revenue repairs at the same time'). However, if, when you originally purchased the property, it was not in a fit state to be lived in or the price paid for the property was substantially reduced because of its dilapidated state, then in the section headed 'Repairs after a property is acquired' it states that all the refurbishment expenditure is capital.