FHL & the Budget of the 23^rd March 2011

For expenditure incurred prior to April 2011 FHL owners can offset their allowance claims against any income stream and possibly receive a rebate from HMRC (providing they have paid tax). However, after April 2011, the allowances can only be used against the income from the FHL itself.

Summary of the current FHL position:

• Before April 2011 (e.g. tax returns for two prior years) = allowances offset against any income stream
• After April 2011 = allowances offset against income from the FHL only

But time is running out!

In addition other qualifying rules, as announced in the Budget, will change after April 2012. HMRC propose a general “tightening up” of the overall rules to ensure that the tax relief is targeted at the owners who can demonstrate that they are conducting a commercial business!

You must apply NOW to claim the optimum available before it’s too late!

Eligibility

• The property must be a furnished holiday let in the UK or a EEA country
• Purchase price of at least £300,000 (collectively) if located in the EEA.
• The owner must be a UK taxpayer.
• Income or losses must be declared in your tax return.
• The property must be let out for more than 70 days each year and available for more than 140 days per year.
• Individual lets should not exceed 31 days and not be let to the same person for more than 31 days in a year.

The property can be anything from a luxury villa to a studio apartment. We typically find at least 25% of the purchase price of the property in claimable capital allowances.

It’s never too late

As it is usually possible to claim allowances for capital expenditure going back many years, possibly right back to when the property was first acquired.

Eligibility

If you have a property that meets all the qualifying criteria and would like an initial appraisal of your property and a fee quotation, please send us the following information:

• A brief description of the property (selling agent’s particulars or a valuation report would be ideal), including photographs, or a link to the website.
• Floor plans, if available.
• Date of purchase.
• Price paid for the property.
• Location, region and country.