Title Sponsor

Furnished Holiday Letting update from sponsors Moore Scarrott

If you are reading this it means you are clearly running a successful business which you care deeply about, otherwise you wouldn't be entering these awards.  As a sponsor we care very much about supporting an enterprise that gives others the chance to showcase themselves and 'get ahead'.  So we are putting together a series of 'info-bites' directed at those of you running a business, which gives some short, sharp hints and tips on ensuring you are making the most of and are aware of certain tax and financial breaks and benefits.

So, our first 'info-bite' concerns Furnished Holiday Letting (FHL) Businesses and important income tax rules to be aware of.

The property needs to qualify for the tax man!                                   

  • From 6 April 2012 the FHL property must be available for letting to the public for at least 210 days per year and be actually let for 105 days per year. There are ways we can help owners of FHLs reach the above thresholds.

Plant, equipment and furniture – don’t forget them

  • Expenditure on fittings, furniture and equipment (and certain integral features) qualifies for a 100% annual investment allowance up to £250,000 per annum for expenditure incurred between 1 January 2013 and 31 December 2014 (£25,000 pa up to 31 December 2012).

    This effectively means that expenditure on such assets installed in a FHL property can be written-off for tax purposes in the tax year in which the expenditure is incurred.

Treatment of losses

  • From 6 April 2011 where a net loss incurs on UK located FHLs it can only be offset against UK FHL profits of a later tax year. 
  • Likewise where a net loss is incurred on FHLs located elsewhere in the EEA, it can only be carried forward against future profits of the same properties.
  • ‘Sideways’ loss relief, which previously allowed losses on FHLs to be set against other types of taxable income, is unfortunately no longer available.

More to come next month – in the meantime, if you have any queries or wish to discuss the above further, please get in touch with Simon Tapp at Moore Scarrott Chartered Accountants on 01823 282100.