Extension of UK furnished holiday lettings rules to EEA until 2010

Hello,

Don't know if you are aware of this, but yesterday's UK Budget brought some good news for those liable to UK tax but with properties overseas.

Basically, the benefits that apply to UK furnished holiday lettings (short term), such as offsetting losses from your income, CGT relief and capital allowances, are being extended to such properties in the European Economic Area until 2010.

Not so good news is that the rules are being repealed in 2010, so it's only a short term benefit.

More information can be found here: http://www.hmrc.gov.uk/budget2009/furnished-hol-lets-1015.pdf and http://www.holidaylettings.co.uk/resources/property-news/rental-news/budget-2009:-changes-to-uk-furnished-holiday-lettings-rules-announced/a-2-56-1680/ .

Hope this has been of help to some of you!

Hello i am new to all this I have a Holiday home in Spain that i rent out to holiday makers we have only had about 6 bookings last year what effect/benifit will this new rule have on myself if any. 

thanks 

Hello i am new to all this I have a Holiday home in Spain that i rent out to holiday makers we have only had about 6 bookings last year what effect/benifit will this new rule have on myself if any. 

thanks 

I doubt whether it will make a difference as I gather the majority of owners in Spain who rent their property out don't declare the income, certainly in Spain where it is 25% of the gross income as I understand it.

If you are a UK tax payer, then you should declare any rental income from property abroad, even if you make a loss overall. Under the new rules, until they are repealed next year, you should be able to offset any losses from your holiday lettings venture against any other income you have. You can also deduct expenses such as mortgage interest, lettings agents fees etc from any income to arrive at the final taxable amount.

It's really worth talking to an accountant - he/she will be able to explain exactly how you could benefit and make sure you get the most out of it.