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FHL

run through company but owned personally

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have taken on a new client  - furnished holiday let run through a company

we have handover info from the previous accountants, problem is there is no property within the company - it turns out the property is owned by the individual

there are no recharges out of the company to the owner

I feel like i'm missing something, is it possible to run a perosnally owned FHL through a company in this way?

it seems to me that the reality of the sitaution is that this is personal income and should be treated as such, and the company set up isnt valid......if thats correct where do we go from here?

Any help is appreciated

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By lesley.barnes
20th Jan 2020 13:37

I think I would be asking the previous accountant what the set up is as a starting point. I don't think you have enough info for you to be able to make a judgement. On the face of it isn't doesn't seem right but it then begs the question why go to all the trouble of setting up a company. Failing that doesn't your client not know why?

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By Cloudcounter
20th Jan 2020 14:43

I would look at the booking forms and correspondence with the tenants. Was the FHL let out by the company or by the individual. If the former, I don't see any issue with there being no recharge to the individual owner. Plenty of company owners allow their companies to use premises rent free for example.

If the documentation points to the contract being between the individual owner and the tenant/hirer, then it is personal income. It would be possible for the company to charge a fee for arranging the lets and acting as agent, but there could be issues working that out in arrears.

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