Furnished Holiday Lettings: the future for landlords

Do you not know what it is?

It is the key to success for landlords and the future for buy-to-let investors. Are you confused about how? Well, the Government has different methods and policies to calculate the earnings and taxes for Furnished Holiday Lettings. These policies make room for an increased rate of investment compared to other properties.

These include:

  1. Benefit from Capital Gains Tax reliefs for traders including Entrepreneurs relief
  2. Claim capital allowances for items such as furniture, equipment, and fixtures
  3. Include the profits as earnings for pension purposes

If your property does not fall under the FHL category, then normal property lettings rules and taxation apply. Pearl accountants will make sure to maintain the FHL status of your property.

First, you need to know what benefits your property will provide if it qualifies as an FHL.

Furnished Holiday Lettings
your property first needs to qualify as an FHL

However, to earn these advantages, your property first needs to qualify as an FHL 

  1. It is essential for the property to exist in the UK or any other European Union Country. 
  2. The level of furnishing in the property needs to meet a certain criterion which makes it eligible to be made available for the public to use. 
  3. The property must be commercialized. The property needs to be let with a profit-making motive. It is important to note that even if you are letting in the offseason, the property will still be considered as an FHL. 

Moreover, there are 3 occupancy conditions that need to be met

The availability

This condition requires that the property must be commercially let for Holiday accommodation to the public for at least 210 days throughout the tax year. If not, then all the tax benefits of FHL will be lost. 

The Commercial Letting

This condition requires the property to be commercially let to the public for at least 105 days throughout the tax year. It does not allow letting to the same person for more than 31 continuous days. If not obliged, then the tax benefits of FHL will be lost. 

The Occupation Pattern

This condition does not allow the property to be let to the same person for more than 31 continuous (multiple lets to different people). If multiple people are let the property for more than 31 continuous days and all these add up to at least 155 days, then the property loses the FHL status. The tax benefits of FHL will be lost if this condition is not met. 

What pearl accountants can do for you

How we can assist you

Owning a property means getting involved with a lot of tax complications. Given the frequent changes in tax policies, we at pearl accountants are at your disposal to find potential ways to decrease your tax liabilities. With regards to furnished Holiday lettings, it is no secret that taxation is quite complex. We will make sure that all your tax issues are handled perfectly. 

Our team of expert accountants will have your financial records ready at all times. We won’t just be keeping a financial check rather advise you on matters that will help you increase your profits through the FHL property. With us, you will be in safe hands.   

We will provide the whole initial review, a proper plan, and calculation of tax with minimized deductions. When to register for VAT and when not will be our headache. We specialize in Furnished Holiday lettings and can guide you on what to do to achieve the FHL status for your property. Moreover, we will help you claim your capital tax gains and FHL expense allowances. Our professional bookkeeping of your financial matters will enable us to do so. We will make sure we make every pound of your count. 

Additionally, our experts will be closely working with you and advising on how to maintain the finances so that the FHL status of your property is kept. You can enjoy the advantages of FHL without any worry of losing them even if the conditions are hard. 

So, what are you waiting for? 

Schedule a meeting today and together we can revolutionize the future of your Furnished Holiday Letting.  

Accountants London
Company Registration No. 07078392