 |
UK Holiday Letting And Tax |
|
|
Submitted by Collette Royal
| RSS Feed
| Add Comment
| Bookmark Me!
This article is meant as a guide only. Advice should be taken from a qualified person.
Letting a fully furnished holiday home in the UK may mean the income made is treated differently than other rental income. Holiday lets are considered a business, where as other property letting income is classed as investment income.
The are some tax incentives for holiday lets, but your accommodation must comply with inland revenue rules, referred to as “QUALIFYING TESTS” which are:
* Based in the UK.
* Furnished rental accommodation.
* Available for holiday letting to the public for at least 140 days a year.
* Actually let as a holiday let for at least 70 days a year (and
these must be commercial lets, not at cheap rates to friends and
family).
* Your occupier cannot stay for more than 31 days in any 7 month period.
* Lets must be at the full market value. This means letting your
cottage to family for £2 a week will not count.
And holiday lets must be (both):
* Short term lets of not more than 31 days.
* The only lets over a period of at least seven months.
Your income from you holiday let is subject to income tax, but you can off-set expenses for example:
* Repairs and maintenance.
* Decorating.
* Heating & lighting.
* Legal and letting agent's fees.
* Management fees and cleaning costs.
* Insurance.
* Mortgage interest payments.
If you make a loss, you can off-set this against your other income to reduce your tax bill. You can avoid paying capital gains tax on the sale of the property if you roll-over the income within 3 years to another holiday letting property.
There are other advantages, and as stated before, take professional advice before heading into holiday letting. There are many mortgages available for the buy to let market and spending some time with a well regarded mortgage advisor would be in your best interest
|
|
|
|
|
LinkedIn Recommendation:
 Annamarie Kaminska - SEO Account Manager at Plow King Studio - I am don't remember the last time I had such a life changing experience before I met Teo. He's full of energy and knowledge. I am on track to where I need to be with my business, and I feel that my relationship with him has made this all possible. He's a truly gifted person. - March 15, 2012, Annamarie was Teo's client |
|
Featured [mortgage] Articles:
 |
 |
 |
 |
|
Related Tags (related articles): mortgage
(392), Holiday
(303), rental
(85), self
(2049), catering
(17), travel
(804), tax
(246), advice
(491), lettings
(1), cottage
(11), cornwall
(9)
|
|
 |
 |
 |
 |
|
|
