What are the tax implications if I let out my holiday home?
If you let out holiday accommodation, the definition of furnished holiday lettings is as follows: • The accommodation must be available for holiday lets for at least 140 days per year. • The accommodation must be let for 70 days in the year. • No let must exceed 31 days. The income is treated as earned income (a trade) attracting Capital Gains Tax rollover relief and business asset taper relief. Tax-saving ideas worth thinking about… • Rollover of capital gains on the sale of trading assets into the purchase of holiday accommodation. • Any gain on the sale of the holiday accommodation may eventually attract Capital Gains Tax at only ten per cent. • You can claim capital allowances on furniture and equipment. • If you make a trading loss from your holiday lets, you may offset it against your other income or capital gains in the same year or the previous one. However, don’t buy the accommodation with a substantial mortgage because HM Revenue & Customs may regard your motives as not bei
