Landlords & Holiday Lettings

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INCOME TAX RETURNS FOR
LANDLORDS & HOLIDAY LETTINGS

At Taxfile we have experience helping with; filling in tax forms, preparing accounts, calculating tax, working out any capital gains implications and dealing with the Inland Revenue when it comes to landlords and rental properties. We will help you accurately identify your capital & revenue costs, making sure you can claim the correct amount of expenses from your rental & letting, and pay the minimum amount of tax that you need to.

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If you are a non-UK resident landlord with income generated from UK property, you may need to complete a Non-Resident Landlords Scheme (“NRLY”) Annual Return. Letting agents or even tenants involved in such a scenario may also have to deduct tax if the rent is over a certain threshold, although certain deductible expenses may be allowed before calculating the tax due. Some non-resident landlords can alternatively apply to HMRC to have UK rent paid to them gross, on the understanding that they will self-assess at the year-end, although this is less common.

Furthermore, if you are thinking of or have sold your property, you may be liable for capital gains tax. We can offer you a free assessment & peace of mind. Call 020 8761 8000 to speak to one of our tax agents.

Holiday Lettings

A furnished property that is commercially available for holiday letting that meets specified criteria is a business income and must be declared as such in the self assessment income tax and also for certain capital tax purposes. There are significant tax advantages in letting property as furnished holiday accommodation, but to do so it must satisfy certain occupancy thresholds.

occupancy thresholds

  • The property must be available for letting as short term holiday accommodation to the public for at least 210 days in the year
  • It must be let as such for at least 105 days in the year
  • Periods of more than 31 days lettings are allowed so long as they amount to less than 155 days in the year
  • The business must be set up with a view to realizing profits
  • Discounted or free lettings by family and friends don’t count towards these totals
  • The lettings must be fully furnished to enable a holiday maker to stay self-catering

If you can meet the above criteria, you can qualify to claim capital allowance on the furnishings & fittings of your holiday home, something not allowed on normal residential lettings.  Initial expenditures can be claimed as pre-trading expenses.

Since the letting is viewed as a business, you can make pension contributions from it in relation to the profits gained.  Furthermore, when you come to sell the property, you may be eligible for Entrepreneur Relief, Roll-over Relief or Hold-over relief from Capital Gains Tax.

OUR EXPERT ADVISOR

Speak to our expert advisors for landlords & holiday lettings by calling 020 8761 8000.

Faiz

Tax Agent

Ewelina

Tax Agent