Parents do 'kick out' their children at 17 but I am imagining things would be quite dire for this to happen.
[https://www.childline.org.uk/Talk/AskSam/Family/Moving/Pages/17-and-kicked-out.aspx]]
and the government has responsibilities for those under 18.
www.gov.uk/your-rights-to-housing-if-youre-under-18
I think Marz speaks a lot of sense, about disengaging from the drama, but I also wonder if your daughter will allow you to disengage.
I really do not know but in your shoes I would really want to speak to a professional, even if it were just you and your dh and them and work out a strategy. I would not throw any child of mine out or ask them to leave but once compulsory education had ended I would be talking to them (or in anticipation of compulsory education ending) about what was going to be next, how it would be funded and where they would live. It sounds like your dd doesn't respect you very much, and I would want to address that. But do beware and take advice, things like stopping her allowance may lead to shoplifting or more aggression, I would want to take advice on this.
I would really see if you can write some sort of agreement, she lives there and you pay for food etc and allowance etc and you expect this minimum standard of behaviour in return.
My dd is 11 and this is all new to me, which is why I am saying seek professional help. But in the meantime you could read....
www.teenswithproblems.com/home_contract.html
www.freeprintablebehaviorcharts.com/behavior_contracts.htm
There are tons on line, it is all very American. I don't think it is unreasonable if you are providing her with all her needs for her work and study that she should not be obliged to extend a small amount of consideration to you both.
But, before you go off the deep end, so to speak, you have said things were working better. Try and find out first why things have gone backwards, try and be neutral for now on the punishments etc and just get to the bottom of it. Is she being bullied, bullied on line, treated badly by previous or current boyfriend, friend worries, study worries, drugs?
Must go to bed, all the best.