Smith & Williamson raise inheritance tax red flag on holiday lets
Treatment of holiday lets should be consistent across the tax spectrum, including inheritance tax Smith & Williamson experts say
Treatment of holiday lets should be consistent across the tax spectrum, including inheritance tax Smith & Williamson experts say
Smith & Williamson has warned holiday property owners that furnished lets
get caught in the inheritance tax net, calling for the government to consult on
the issue.
The taxman no longer considers holiday lets as qualifying for business
property relief, in respect of inheritance tax, unless very significant
additional services are provided, experts at the firm warned.
Taxpayers can claim business property relief for 2010/2011 and 2012/2013
through an annual investment allowance of £100,000, but the Labour government
had planned to reduce this to £25,000 from 2012/13.
The government has now opened up a consultation on the issue, but the IHT
rules are out of kilter with the rest of tax framework.
“It would be helpful if the announced consultation also dealt with this issue
so that the treatment of holiday lets is consistent throughout the taxes,” said
Helen Demuth, tax director at the firm.
“There is therefore a further window of opportunity to review your furnished
holiday let properties and consider improvements or disposal, particularly if
your properties only just qualify under the existing rules,” Demuth added.
Further reading:
Holiday
home VAT exemption boost for private builders
Election
hopefuls clash over tax
More about:
In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...
View resourceIn recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...
View resourceIn a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...
View resourceThe first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...
View resourceThis was the fourth largest borrowing year since records began in 1993 Read More...
View articleThe report states the current system “manages the uniquely bad twin feat of being both wildly unpopular and raising very little revenue" and proposes ...
View articleFollowing the Chancellor calling for a review into IHT, industry experts call for examination of the residence nil rate band, taper relief and taxing ...
View articleHMRC collected a record £5.1bn in inheritance tax in the year June 2016 to May 2017, according to private client law firm Wilsons Read More...
View articleInheritance tax relief increased by 16% last year to £880m, compared to £760m in the previous year. The amount is significantly higher than the £420m ...
View articleRosamond McDowell looks at key changes to inheritance tax policy, which apply from April this year Read More...
View articleLet us hope that valuable asset protection vehicles are not made prohibitively burdensome or abolished in the desire to “simplify” IHT Read More...
View articleIHT take up 17% in just a year as more estates pass tax threshold Read More...
View article