Own a rental in Darlington? Good news. You can still cut your tax bill. But things are changing fast, and 2026 brings fresh rules you need to know now.
Let’s make this simple.
What You Can Still Claim
Here’s the good bit. If you own property in Darlington and rent it out, you can claim loads of costs. The trick? They must be “wholly and exclusively” for your rental.
Your Main Money Savers
Repairs and upkeep come first. Got a broken boiler? Dodgy electrics? Leaky roof? All claimable. Just remember: repairs fix things. Upgrades don’t count. Replace like with like and you’re golden.
Insurance matters too. Buildings cover, contents, landlord insurance. All in. You’re probably paying £150 to £450 yearly anyway, so claim it back.
Letting fees and agent costs add up quick in Darlington’s market. Every penny you pay them? Claimable.
Council tax and utilities count when you foot the bill between tenants. Don’t leave money on the table here.
Travel costs surprise people. Pop over to check on your Darlington property? Mileage adds up. Keep a log. Most folks forget this one entirely.
The Mortgage Interest Catch
Now, here’s where it gets tricky. And honestly, a bit annoying.
You can’t deduct mortgage interest anymore. Not like before. Instead, you get a 20% tax credit. So, if you paid £5,000 in interest? You get £1,000 back as a credit against your tax bill.
It’s not as good as it sounds for higher earners.
What’s Coming in 2026 and Beyond
Right, pay attention here because this matters.
Tax Rates Going Up (2027)
From April 2027, rental income gets taxed separately at higher rates. Basic rate jumps to 22%. Higher rate hits 42%. Top rate? A whopping 47%.
That’s a 2% bump across the board.
The Property Allowance Stays Put
Good news on this front. You can still earn up to £1,000 tax-free from property. But if your rental income tops that (and let’s be honest, it does), you need to report everything.
Making Tax Digital Starts Soon
Here’s the big one for 2026. If your rental income goes over £50,000, you’ll need to file quarterly updates starting April 2026. Digital only. No more shoeboxes of receipts.
Smaller landlords with £30,000+ follow in April 2027.
Easy Wins Most Darlington Landlords Miss
People overlook these all the time:
- Accountant fees (yes, the cost of doing your tax return counts)
- Professional fees for legal work or surveys
- Replacing knackered furniture or appliances
- Landlord subscriptions and memberships
- Bank charges on your property account
- Printing costs for tenancy agreements
- Safety certificates (gas, electric, EPC)
Track everything. Seriously, everything.
Quick Reference Table
| Expense Type | Can You Claim? | Notes |
| Repairs | Yes | Must restore, not improve |
| New kitchen | No | That’s an improvement |
| Mortgage interest | Partial | 20% credit only |
| Agent fees | Yes | All of it |
| Insurance | Yes | Buildings and contents |
| Council tax | Yes | When you pay it |
| Travel to property | Yes | Keep mileage records |
| Accountant | Yes | Deductible expense |
| New carpet | Yes | If replacing worn one |
Smart Moves for 2026
Start tracking now. Don’t wait until tax time. Use an app or simple spreadsheet. Digital is coming whether you like it or not.
Keep receipts for five years. HMRC checks. They really do.
Consider the £1,000 allowance carefully. Sometimes claiming actual expenses saves more. Sometimes it doesn’t. Do the maths.
Get professional advice. Tax rules keep shifting. A good accountant pays for themselves, especially with changes coming.
What About Darlington Specifically?
Darlington’s rental market is steady. Average monthly rent sits around £800. Properties range from £400 to £1,500 depending on size and area.
The town centre stays popular. So does the West End. Both attract reliable tenants, which means fewer void periods. Less empty time means better returns and more to write off.
Local costs matter too. Darlington tradespeople charge fair rates compared to bigger cities. Your repair bills might run lower than Newcastle or Leeds. That’s good. But claim them anyway.
The Bottom Line
Property owners in Darlington face the same tax squeeze as everyone else. Rates are climbing. Rules keep changing. Making Tax Digital looms large.
But you’re not powerless.
Track expenses properly. Claim everything allowed. Prepare for digital filing early. Get advice when you need it.
Most importantly? Don’t assume you know what’s claimable. The rules surprise people constantly. That old boiler repair? Yes. Those fancy new smart thermostats throughout? Probably not.
When in doubt, ask. Better safe than sorry when HMRC comes knocking.
Need to Sell Instead?
Sometimes the tax burden gets too heavy. Or life changes direction. If selling makes more sense than landlording, you’ve got options locally.
Call Sell House North East at 01642 088037 for straight advice on selling property in Darlington and the wider North East.
*Tax rules change frequently. This guide covers 2026 based on current legislation. Always verify current rules with HMRC or a qualified accountant before making decisions.