HMRC will be watching your business like a "hawk" in the first year and probably the second year, as most fail then. They will have AI and search bots watching the web, your site, airbnb. They'll talk to each others' computer systems. The VAT section, the income tax section will all cross-reference your activity. They'll know
Hi Paul, great video! How do you find proof for the rental value of the property, before owning it, in order to get a holiday let mortgage? Is it possible to use a residential mortgage for a holiday let property?
Tricky if it hasn't been rented before and this might be a bigger problem in getting it mortgaged. Many lenders will base it on an AST rental figure which the valuer will determine. They treat affordability then like a normal BTL mortgage
Paul, I am looking to buy such property this year in Cornwall or Devon. This would be my first such purpose, I only own my own home for now. Could I take some of you timeto get some down to earth advise?
So long as you achieve the minimum HMRC lettings days, then naturally you can. But these will probably be off-season, you'll want to rent in high season. The whole rationale is that you are running a business not a second home with tax breaks. Check with a good accountant or the HMRC direct
You can stay yourself yes. However the days you stay do not count towards the FHL conditions. You must have the property on the open market for 210 days per year and you must book at least 105 of those days for paying customers (excl family and friends too unless paying 100% rate). You must also make a profit, or operate with the intention of making a profit. The rules change quite often, so its worth downloading the latest guidance and reading up for 2020. I have no doubt it will change again in 2021. Most holiday lets will need to be let out for at least 20-25 weeks a year to turn a reasonable profit anyway - esp if you are using an agent for marketing and change over. Most people with FHLs aim for 28-30 weeks a year occupancy and 10% ROI.
Great info, teasing out some valuable insights, thanks!
Who would practically check how many days it's let in a year ? What if I am not doing so well ? Are tax men fast on FHL ?
HMRC will be watching your business like a "hawk" in the first year and probably the second year, as most fail then. They will have AI and search bots watching the web, your site, airbnb. They'll talk to each others' computer systems. The VAT section, the income tax section will all cross-reference your activity. They'll know
Hi Paul, great video!
How do you find proof for the rental value of the property, before owning it, in order to get a holiday let mortgage?
Is it possible to use a residential mortgage for a holiday let property?
Tricky if it hasn't been rented before and this might be a bigger problem in getting it mortgaged. Many lenders will base it on an AST rental figure which the valuer will determine. They treat affordability then like a normal BTL mortgage
Thank you!
Paul, I am looking to buy such property this year in Cornwall or Devon. This would be my first such purpose, I only own my own home for now. Could I take some of you timeto get some down to earth advise?
Your best bet is to contact a broker specialising in holiday let mortgages who is authorised to give advice
Is it allowed for owners to stay in holiday let property for few weeks?
So long as you achieve the minimum HMRC lettings days, then naturally you can. But these will probably be off-season, you'll want to rent in high season. The whole rationale is that you are running a business not a second home with tax breaks. Check with a good accountant or the HMRC direct
You can stay yourself yes. However the days you stay do not count towards the FHL conditions. You must have the property on the open market for 210 days per year and you must book at least 105 of those days for paying customers (excl family and friends too unless paying 100% rate). You must also make a profit, or operate with the intention of making a profit. The rules change quite often, so its worth downloading the latest guidance and reading up for 2020. I have no doubt it will change again in 2021. Most holiday lets will need to be let out for at least 20-25 weeks a year to turn a reasonable profit anyway - esp if you are using an agent for marketing and change over. Most people with FHLs aim for 28-30 weeks a year occupancy and 10% ROI.