Furnished Holiday Lets

Capital allowances are currently available to UK taxpayers for money spent buying or building furnished holiday lets and, in certain circumstances, holiday accommodation run as a ‘property business’. Depending on the specification of the property between 15% and 30% of the expenditure may qualify for tax relief.

To qualify as a furnished holiday let, the property needs to be located in Europe (although other locations can also qualify under certain circumstances), available to let for 140 days, and actually let for 70 days during the year. It also must not be let to the same person for more than 31 days in any 7 month period.

However, the Government recently announced that the rules will soon change so that capital allowances will no longer always be available for expenditure incurred after 5 April 2010. The good news is that until this happens, capital allowances can be claimed for money spent in the past, as long as the property is still owned when the claim is submitted. Often this scenario produces cash repayments from HMRC, but to benefit, action needs to be taken quickly or the opportunity will be lost.

Please contact us for more information and a free of charge assessment of what savings are possible.