Sarah Bradford looks at some important tax implications when considering buying a holiday let.
The Covid-19 pandemic has put a massive dampener on foreign holidays. As a result, the British ‘staycation’ holiday market, helped by the good weather, flourished this year.
For property investors looking for their next property, buying a holiday let could be a good move – from a tax as well as from an income perspective.
Furnished holiday lettings: Special rules
When it comes to let property, not all property is equal when it comes to tax – lettings that qualify as ‘furnished holiday lettings’ (FHLs) benefit from special tax rules. Although the rules are not as advantageous as they were in the past, they still ‘trump’ those applying to normal residential lets.