Do You Have a Furnished Holiday Let? Discover How the New Rules Will Affect You

The New Rules for Furnished Holiday Lets

We have some important news regarding the new rules for Furnished Holiday Lets (FHLs) that you need to know. Here’s a simplified breakdown:

1. Interest Restrictions: Starting April 5, 2025, interest on loans for your Furnished Holiday Let will be limited, just like the rules for regular residential properties. This means you may need to review your finances to see how it affects you!
2. Capital Allowances: If you have any balance carried forward for capital allowances, you can still receive your yearly allowances. However, you won’t be able to add any new costs moving forward, so any upcoming investments need to be considered with this in mind.
3. Business Asset Disposal Relief (BADR): Good news! You can continue to claim BADR for up to three years if you sell your Furnished Holiday Let, just like you would if you were selling a regular business. This can help reduce any potential tax when you sell.
4. Rollover Relief: If you sell your holiday let and reinvest the proceeds into a qualifying asset, you can benefit from rollover relief, allowing you to defer the tax.
5. Using Carry Forward Losses: If you’ve got losses carried forward as of April 5, 2025, you can now use those to offset any profits from other UK rental properties!

These updates can affect your tax planning and rental strategy, so it’s a good idea to take a closer look at how they might apply to you.

If you have any questions or want to chat about how these new rules impact you, please contact us! Our team is here to help and ensure you make the most of these changes.