Hello everyone,
I currently own a Ground floor flat, this is the only property that I own and it’s currently on a residential mortgage, for a while now I have wanted to operate a holiday let, for about 2 years now the flat above me has been used as a holiday let, the occupancy rate is very high, and I can see that it is a successful business model. I have been rennovating my flat to a high standard over the past few years, at the moment I have just reworked the existing layout by doing a side extension and am in the process of fitting underfloor heating, new kitchen, new bathroom etc, the work once finished will have cost in the region of about £40,000, fully furnished with new furniture/appliances etc.
It was my intention to live in the flat for around 1-2 years and then convert to a holiday let mortgage, but I’ve recently read an article which stated that I can claim back some of the costs of refurbishment if it’s offered as a holiday let, is this true and what procedure would I need to follow in order to be eligible for this? I’m assuming that the property needs to be offered as a holiday let before or directly after the refurbishment to qualify is that correct?
Also do you have any advice or tips on how to switch from a residential mortgage to a holiday let mortgage? I believe I have about 50% equity in the property once the work has been completed, and I am in a fulltime job so I think I would qualify for this type of mortgage.
I guess I am trying to work out if I should stick to my original plan of planning to do it in 1-2 years, or if I could actually claim back some of the cost that I have spent on it and do it sooner, any guidance would be much appreciated.
Thanks
Best approach to take when starting a Holiday Let
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- Posts: 7
- Joined: Mon Apr 13, 2015 10:30 am
- Location: Southwold
My understanding is that refurbishment/upgrade works cannot be offset against tax but that the purchase of certain fixtures and fittings can, things like fridge, freezers, TV etc. You can also offset mortgage interest, but not capital repayments. Also probably wise to have the property re-assessed for business rates, which assuming the new assessment is below £12k (which it should be) will currently result in 100% relief.
I'd rather be cycling
Not just fridges and freezers. You can claim capital allowances on heating and electrics and fitted kitchens too. See https://www.gov.uk/capital-allowances/w ... n-claim-onBasil Fawlty wrote:My understanding is that refurbishment/upgrade works cannot be offset against tax but that the purchase of certain fixtures and fittings can, things like fridge, freezers, TV etc.
thanks for your replies, in order to claim these things would i have to change to a holiday let mortgage within a certain period?
What i'm trying to understand is if i buy fixtures and fittings now, can i keep the receipts and make a claim for when i turn it into a holiday home in the future? (i.e 1 to 2 years time)
What i'm trying to understand is if i buy fixtures and fittings now, can i keep the receipts and make a claim for when i turn it into a holiday home in the future? (i.e 1 to 2 years time)