Page last updated at 15:20 GMT, Wednesday, 22 April 2009 16:20 UK

Tax blow for holiday-home owners

Holiday homes are popular in areas such as Cumbria

Thousands of UK holiday-home owners face losing a range of tax benefits under changes announced in the Budget.

From April next year, holiday property landlords will no longer be able to write off "trading" losses from second homes against their tax bill.

Capital allowances and capital gains benefits will also go.

Tax experts say the move is likely to anger tens of thousands of people - many of who based retirement plans on the current tax rules for second homes.

In a small silver lining, those owning homes within the EU, but outside the UK, will get the tax benefits currently enjoyed by owners of UK holiday homes until April 2010.

However, these will then also be scrapped.


Most computers will open this document automatically, but you may need Adobe Reader

"You are going to see a very vocal, articulate section of society screaming blue murder about this," said tax expert Anne Redston, Visiting Professor at King's College, London.

"People have bought holiday properties and worked out their projections based on the tax rules as they exist at the moment."

Currently a home qualifies as a holiday property if it is furnished, being run as a commercial business and available for rent to the public for at least 140 days per year. It must also be let for at least 70 days a year to attract the tax benefits.

HM Revenue and Customs said it was extending the tax benefit to those owning holiday homes inside the EU but outside the UK until next April because it feared it was unlawful to have the current discrepancy.

Print Sponsor

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Sign in

BBC navigation

Copyright © 2020 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific