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Readers Forum: Furnished property letting

05 January 2021
Issue: 4774 / Categories: Forum & Feedback
Property allowance claim on holiday lettings.

My question relates to the £1 000 property allowance where if the rental income exceeds £1 000 the taxpayer can be taxed on the income less £1 000 and the actual expenses are ignored. This is clearly advantageous if the actual expenses were only say £500. I understand that furnished holiday lettings have special tax treatment but is this income combined with other rental income when considering the £1 000 property allowance?

I have a client where on page 2 of the property pages of the tax return I have rental income of £4 675 expenses £187 and net profit £4 488. Clearly it would be better here to claim the £1 000 allowance. However on page 1 of the property pages I have furnished holiday lettings income of £2 321 expenses of £2 445 and a net loss...

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