After what feels like ages of confusion over what is happening with the tax treatment of furnished holiday lettings, a consultation document has been issued by the new government setting out their proposals. Use the link to access the full document. You can participate in the consultation as described in the document. The consultation period lasts until 22 October.
The proposal is to retain special tax rules for furnished holiday lettings, but the rules proposed are more stringent than the existing rules. Specifically it is proposed that:
- properties should be available for holiday letting for 210 days (as opposed to the current 140 days) per year
- properties should be actually let as a holiday let for 105 days (as opposed to the current 70 days) per year
- losses can only be offset against other furnished holiday lets rather than any trading activity.
Longer lets of more than 31 days for 155 days per year appear to be accepted for properties designated as furnished holiday lets.
So if you are letting your properties as short term or holiday lets full-time, as many of us do, these rules will be less of a change than for people who let short term for some of the year and have longer lets for the rest of the year.
As usual we’d love to hear your views.
