just want to sense check this.
client buys a second home. it is purchased as a holiday home for the family and occasssional letting
he spends a significant amout renovating
he spends a significant amount on furniture, curtains, paintings and expensive rugs etc.
he lets the house to holiday makers during 11/12 for only 8 weeks (through choice)
because it is not an FHL, I assume it is just therefore income from a normal property business
so - no allowance for CA's + 10% WTA only (or replacement method if chosen)
Replies (3)
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You're probably right
I tend to agree with what you say, as it probably does not meet the 'number of weeks let' (forget offhand what that is) requirement for FHLs.
However, if this were the first year and it wasn't available for the full year, you could presumably pro rata the number of weeks.
Was it also let in the current year ? If it were let for sufficient weeks this year you could argue that last year was the first year and couldn't be expected to have many bookings.
No first year pro rata for FHLs
See Helpsheet 253 page 3 http://www.hmrc.gov.uk/helpsheets/hs253.pdf
FHLs must meet the tests for a 12 month period before they can qualify for FHL treatment from start of letting. A clear example is given on page 3 of HS253.
Sorry, I'm late to stumble on this thread.
Jim