Our client has two holidays lets (FHL) and five rental properties. They have built up substantial losses on the FHLs due to Covid-19 and the FHL market on these properties not picking up post-Covid in the way some other FHLs did in other areas eg coastal.
It is our understanding that under the change in the rules from 6 April 2025 the FHL losses can be offset against the profits from the rental properties.
With the change in FHL rules it appears that our client has benefited from the change in tax terms and also in commercial terms as they plan to incorporate more long term lets into the previous FHL model without being bound by restrictive FHL tax regulations?
We welcome feedback on this question and wonder if HMRC will question previous FHL losses with regard to reasons for losses etc?
Query 20 503 – Beach...
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