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Milton Keynes: +44 (0)1908 605552

Pre-Budget Report 2009 - furnished holiday lets

The Chancellor has confirmed that the furnished holiday lettings rules will be withdrawn from 2010/11.

This means that a furnished holiday let will be treated as any other property business. Some of the tax consequences of this will include the following issues:

  • Losses incurred before 6 April 2010 that have not been relieved at that date will be treated as losses from a property business. These will then only be available to set against future profits of the property business as will any future losses.
  • Capital allowances will not be available for expenditure incurred on or after 6 April 2010 on plant and machinery for use within the let property.
  • The business is no longer a trade for capital gains purposes which will result in the potential loss of some valuable capital gains reliefs.
  • From 6 April 2010 income from letting furnished holiday accommodation will not be relevant UK earnings for pension relief purposes. 

Liz Cuthbertson is a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Liz you can contact her at or call 020 7353 1597.



Date: 9th December, 2009
Author: Liz Cuthbertson


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