Furnished Holiday Lettings
Landlords with furnished holiday accommodation in the UK have generally been treated as trading for various tax purposes.These include loss relief set-off, capital allowances, certain capital gains tax reliefs and the calculation of earnings for pension purposes. In order to comply with European law, this treatment is, temporarily, to be extended to such property within the European Economic Area (EEA) for 2009/10 only.
However, from 6th April 2010 the letting of furnished holiday accommodation whether in the UK or the EEA will no longer enjoy favourable trading status.
Losses arising will only be available for set off against any other property income.
Clearly, this is bad news for those landlords who will no longer be able to claim loss relief against their other income.
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