Furnished Holiday Let - Tax Questions

  • Filter
  • Time
  • Show
Clear All
new posts

    Furnished Holiday Let - Tax Questions

    Hi I have a property that I'm letting through a short term holiday letting company. All seems good so far, but can someone let me know how the tax works on this? Its located in Brighton if that makes a difference?

    Also as this is a "furnished Holiday Let" what can I get away with in terms of mortgage interest, initial costs to furnish the place etc.



    Best to phone in and ask a tax inspector.

    But, I believe the position includes:
    • To get any tax relief, the property has to be available to let for at least 210 days each tax year and actually let at least 105 days each tax year.
      if property is bought part-way through a tax year, then the above must apply for the 12 months from when it is purchassed (or maybe from when first let)
    • Finance costs are fully deductible.
    • Capital allowances are available.
    Read PIM (property income manual https://www.gov.uk/hmrc-internal-man...-income-manual).
    All of it is relevant, but PIM4100 has rules that apply only to furnished holiday lets.


      Personally, I wouldn't take advice from HMRC, a) the people manning the phone aren't qualifies and b) it's like taking legal advice from the police about a criminal matter.

      You need to sit down and talk it through with an accountant in some detail (I'd imagine Brighton has quite a lot of them with experience in this field).
      You should look carefully at mortgages as they're not the same as BTL lending.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).


        Originally posted by jpkeates View Post
        Personally, I wouldn't take advice from HMRC, a) the people manning the phone aren't qualifies and b) it's like taking legal advice from the police about a criminal matter..
        1. You speak to a tax inspector, not the person that answers the phone (phone your own tax office, or the one local to you).
        2. Get the tax inspector to put the advice in writing to you.

        I have done this several times.
        Once I was given unsolicited information that allowed me to claim about £3000 a year deductions on holiday lets of a caravan.

        Which reminds me: losses on furnished holiday lets can be offset against other income (unlike losses on residential lettings).


          BBC Moneybox today suggested new rules in Oct will require LL to spend min 1 night in holiday Let to gain any tax advantage for duration of Let.


          Latest Activity


          • Lease Extension Subject to Taxation?
            Hi there. I live in a Victorian property which has been divided into 5 flats.
            Several years ago, three of the flat owners (including myself) purchased the freehold. The two remaining flat owners decided that they would not participate in the freehold purchase.
            A company was formed for the...
            17-07-2018, 11:10 AM
          • Reply to Lease Extension Subject to Taxation?
            Normally the freehold company will report the income received from lease extension as "annual profit" in its annual acounts which are produced after the year end.

            The profit will be reported in the tax return and about 13 months later the company get a tax bill of around 20%....
            18-07-2018, 15:43 PM
          • Banana Skin
            I feel I have messed up my life. Despite working hard, I have landed on a banana skin.

            I bought a 3 bedroom house many years ago. It seemed like a nice area. Little did I know, nearby the local housing associations had housed the thugs like the Kray twins and their chums. It was a "problem...
            17-07-2018, 15:22 PM
          • Reply to Banana Skin
            CGT is only 18% (28 If you earn a lot). You still get 82% of any increase in value.
            Plus the rental income.
            18-07-2018, 07:00 AM
          • Reply to Banana Skin
            If you quote some details : we can work out roughly the cgt.

            When you bought the property and the price paid
            Dates when you lived in the property.
            Market value now .
            17-07-2018, 19:26 PM
          • Reply to Lease Extension Subject to Taxation?
            Thank you very much for your response - I appreciate any assistance.
            The only trouble is that there are two companies involved (I should have mentioned this previously!)
            One company is the freehold company (representing the interests of the freeholders - collecting ground rent, leasehold...
            17-07-2018, 16:28 PM
          • Reply to Lease Extension Subject to Taxation?
            I'd leave the money in the company, and relieve the directors of paying service charge until such time as the cash is depleted.
            17-07-2018, 15:43 PM
          • Reply to Banana Skin
            Be thankful there is an increase to pay CGT on.

            I bought a flat in Torquay in 2005 for £185k. Someone turned the bungalow next door into a house, wiping out my sea views and about £60k of value. It has now been for sale for £175k for a month without a sniff.

            Presumably your...
            17-07-2018, 15:37 PM
          • Reply to Lease Extension Subject to Taxation?
            Thanks. We acted as a limited company in order to process the lease extension. The limited company comprises the three freeholders..
            17-07-2018, 15:24 PM
          • Reply to Lease Extension Subject to Taxation?
            Was the lease bought in your personal names or in a limited company?
            17-07-2018, 14:51 PM