Can purchasers offset their losses on a furnished holiday let against other income?
Although the last Government intended to change this situation, this was never achieved before the General Election. The Coalition has decided for the time being to leave the current position alone.
Provided the property qualifies as a “Furnished Holiday Let”, then this tax loss continues to be considered a trading loss for tax purposes. Any losses therefore can be offset against other income.
A Furnished Holiday Let is defined by the following criteria:-
- The property must be available to let for 140 days of the year.
- The property has to be let out for at least 70 days a year.
- It cannot be let for more than 31 days at a time to the same tenant.
27th July 2010
Editor note (May 2017): new guidance can be found on the UK.GOV website here.