The Government has just published a consultation paper on proposals to change the tax rules for furnished holiday lets so they meet EU legal requirements in a fiscally responsible way.
The proposed changes to the special tax rules for furnished holiday lettings include;
- increasing the number of days for which a property must be available to let from 140 to 210 days each year;
- increasing the number of days for which a property is actually let to the public from 70 days to 105 days during a year;
- the proposals also restrict the use of loss relief from furnished holiday lettings so it can only be set against certain income from the same business.
The consultation will run from 27 July to 22 October. The Government will publish its response by the end of the year and intends to implement the changes in the 2011 Budget.
The consultation paper can be downloaded at: http://www.hm-treasury.gov.uk/consult_holiday_lettings.htm
If you have an opinion or a respons to the proposals then e-mailed them to Jacqueline Latter: holiday-lettings-consultation@hmtreasury.gsi.gov.uk
Initial opinions are that the tax changes will have little impact on those who run successful holiday lets, as the ‘actually let’ days are realistic. However, those who holiday let solely to take advantage of tax perks will have to take letting seriously and adjust to the proposed changes – rightly so.
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