I have a furnished holiday letting (FHL) and need to understand the tax implications of selling it. Is entrepreneurs’ relief still available on capital gains tax (CGT) when it comes to selling a FHL, or is it a standard 28% for 40% taxpayers?
Arthur Weller replies:
If you are certain that your property is a qualifying FHL, and you have complied with the rules for entrepreneurs' relief (ER), then ER will be available to reduce the CGT rate to 10% when you sell your FHL property. However, there will be an issue if you have more than one FHL property, and you don't sell your whole FHL portfolio. HMRC will likely claim that you have not sold your 'whole business'.
This question was first printed in Property Tax Insider in October 2019.