Furnished holiday lettings

Why did the government originally decide to abolish the favourable tax treatment for UK furnished holiday lettings?

Because it cost the government too much in lost tax revenues

Because of a court case in which it became apparent that their treatment was inconsistent with European law

Because they did not like this form of tax relief

Because the relief had become less relevant than in the past

From which dates are the changes in the FHL regime effective for individuals?

In stages; partially from 6 April 2011 and partially from 6 April 2012

From 1 April 2011

From 6 April 2011

From 6 April 2012

Miss Austra is a UK resident and has a property in Austria (which is in the European Economic Area). During the year ended 5 April 2012, she let out the property on the following basis. The flat is available for letting to holidaymakers from the beginning of March to the end of December and is actually let on one and two week holiday lets for a total of 115 days. The property is vacant the rest of the time. Will the property qualify as a furnished holiday letting?

No, as the available for letting condition is not met

No, as the property is not situated in the UK

No, as the available for letting and actual letting criteria are not met

Yes. All of the required criteria are met

Mr Bump is a UK resident, has a property in South Wales on short term lets. During the year ended 5 April 2012, he let out the property on the following basis. The flat is available for letting to holidaymakers from the beginning of March to the end of December and is actually let on one and two week holiday lets for a total of 85 days. The holiday lettings include a holiday taken by some friends from 1 July to 14 August. Will the property qualify as a furnished holiday letting?

No, as the available for letting and actual letting criteria are not met

Yes. All of the required criteria are met

No, as properties in Wales are not eligible

No, as the property is occupied by the same people for a period of more than 31 days during the holiday letting period

Mr Wilson owns a property in Margate which qualifies as a furnished holiday letting. During the year ended 5 April 2011, he makes a loss for income tax purposes of £10,000. Which of the following type of loss relief is NOT available to Mr Wilson?

Against his capital gains for the year ended 5 April 2010

Against his general income for the year ended 5 April 2008

Against his general income for the year ended 5 April 2011

Against his general income for the year ended 5 April 2012

Chunks Ltd owns a property in France which qualifies as a furnished holiday letting. During the accounting year ended 31 August 2010, the letting makes a loss for corporation tax purposes of £10,000. Which of the following type of loss relief is NOT available to Chunks Ltd?

Against the company’s chargeable gains for the year ended 31 August 2010

Against the company’s income from its widget trading business for the year ended 31 August 2010

Against the company’s income from its widget trading business for the year ended 31 August 2011

Against the company’s chargeable gains for the year ended 31 August 2009

Mr Jenkins realises a loss on the letting of his furnished holiday let property during the year ended 5 April 2012. What types of loss relief are available to Mr Jenkins in respect of those losses?

Against general income for 2011/12 and then carry forward any unused losses against future profits from the same furnished holiday letting business

Carry the losses forward against future profits arising from the same furnished holiday letting business

None of these

Against general income and capital gains for 2011/12 and then carry forward any unused losses against future profits from the same furnished holiday letting business

Mr Tumble is a VAT registered plumber who turns over £200,000 in the year ended 5 April 2012. He also owns a furnished holiday let in the Lake District and receives rental income therefrom of £10,000. What would be the VAT position on the income received from his furnished holiday letting?

VAT is due at a reduced rate of 5%

There is no VAT due as furnished holiday lettings are not subject to VAT

VAT will be due in the FHL income as this is a standard-rated business supply and Mr Tumble is VAT-registered

There will be no VAT as the income received is below the VAT registration threshold

Which of the following capital gains tax reliefs NOT be available on a qualifying FHL property?

Entrepreneurs’ Relief

Business asset roll-over relief

Private residence relief

Relief for losses on loans to the person carrying out the FHL business, used for the purposes of the trade

Transitional relief is available on the change in respect of the change of qualification criteria from 2010/11 to 2011/12. In which of the following circumstances would the transitional relief be available for 2011/12 for a property which had previously qualified as an FHL in 2010/11?

Available for letting - 150 days; actual letting - 144 days; no continuous periods of occupation exceeding 31 days

Available for letting - 219 days; actual letting 138 days; one continuous period of occupation exceeding 31 days during the holiday letting season

Available for letting - 210 days; actual letting - 74 days; no continuous periods of occupation exceeding 31 days

Available for letting - 145 days; actual letting - 80 days; no continuous periods of occupation exceeding 31 days

Furnished holiday lettings

Why did the government originally decide to abolish the favourable tax treatment for UK furnished holiday lettings?

From which dates are the changes in the FHL regime effective for individuals?

Mr Wilson owns a property in Margate which qualifies as a furnished holiday letting. During the year ended 5 April 2011, he makes a loss for income tax purposes of £10,000. Which of the following type of loss relief is NOT available to Mr Wilson?

Chunks Ltd owns a property in France which qualifies as a furnished holiday letting. During the accounting year ended 31 August 2010, the letting makes a loss for corporation tax purposes of £10,000. Which of the following type of loss relief is NOT available to Chunks Ltd?

Mr Jenkins realises a loss on the letting of his furnished holiday let property during the year ended 5 April 2012. What types of loss relief are available to Mr Jenkins in respect of those losses?

Mr Tumble is a VAT registered plumber who turns over £200,000 in the year ended 5 April 2012. He also owns a furnished holiday let in the Lake District and receives rental income therefrom of £10,000. What would be the VAT position on the income received from his furnished holiday letting?

Which of the following capital gains tax reliefs NOT be available on a qualifying FHL property?

Transitional relief is available on the change in respect of the change of qualification criteria from 2010/11 to 2011/12. In which of the following circumstances would the transitional relief be available for 2011/12 for a property which had previously qualified as an FHL in 2010/11?

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Furnished holiday lettings

Why did the government originally decide to abolish the favourable tax treatment for UK furnished holiday lettings?

From which dates are the changes in the FHL regime effective for individuals?

Mr Wilson owns a property in Margate which qualifies as a furnished holiday letting. During the year ended 5 April 2011, he makes a loss for income tax purposes of &pound;10,000. Which of the following type of loss relief is NOT available to Mr Wilson?

Chunks Ltd owns a property in France which qualifies as a furnished holiday letting. During the accounting year ended 31 August 2010, the letting makes a loss for corporation tax purposes of &pound;10,000. Which of the following type of loss relief is NOT available to Chunks Ltd?

Mr Jenkins realises a loss on the letting of his furnished holiday let property during the year ended 5 April 2012. What types of loss relief are available to Mr Jenkins in respect of those losses?

Which of the following capital gains tax reliefs NOT be available on a qualifying FHL property?

Transitional relief is available on the change in respect of the change of qualification criteria from 2010/11 to 2011/12. In which of the following circumstances would the transitional relief be available for 2011/12 for a property which had previously qualified as an FHL in 2010/11?

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Test passed. Enter your details to download your certificate. Your certificate will also be sent to you by email.

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Mr Wilson owns a property in Margate which qualifies as a furnished holiday letting. During the year ended 5 April 2011, he makes a loss for income tax purposes of £10,000. Which of the following type of loss relief is NOT available to Mr Wilson?

Chunks Ltd owns a property in France which qualifies as a furnished holiday letting. During the accounting year ended 31 August 2010, the letting makes a loss for corporation tax purposes of £10,000. Which of the following type of loss relief is NOT available to Chunks Ltd?