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Tax implications of owning a Residence

The following is a brief outline of the current (November 2022) rules relating to personal taxation of your Residence. The guide is solely for information only. We strongly recommend that you seek professional advice from an accountant or tax advisor in relation to your purchase.

General

Furnished holiday Let (FHL)

Mortgage interest Relief

Income Taxes and Losses

Capital Allowances

Pensions

Capital gains tax

Record Keeping and Tax obligations

Need further advice?

We work closely with a team of tax advisors who can give you specific advice on the purchase of your Residence and how this could affect you.

We can also recommend an independent financial advisor who can offer advice relating to pension aspects of owing a Residence and can also assist you with raising finance for your purchase.

Side table lamp detail
Garden stairs path
Wine bottles on shelf

Investment Return Summary

2 bedroom Residence
Purchase price
350,000
SDLT & fees
21,000
Furniture and appliance package
30,000
TOTAL
401,000
Income per annum (based on 28 week occupancy)
37,590
Associated costs per annum
Residence booking commission
5,638
Property management fee
4,020
Change over fee (£80 per rental)
2,240
Repairs and maintenance
500
Sinking fund - roof
600
Total
12,998
Net income
24,591
Percentage return on investment
6.1%

(Not including any capital appreciation)

N.B. The above calculations are based on estimates, individual costs may be lower or higher than shown in the example above.

Approximate Rental Calculations

Month
Season
Weeks
Approx. Rate
Occupancy
Weeks Let
Apr
L
3
£900
33%
1
H
1
£1,500
100%
1
May
H
5
£1,500
60%
3
Jun
H
4
£1,500
80%
3.2
Jul
H
5
£1,500
80%
4
Aug
H
5
£1,500
80%
4
Sep
H
4
£1,500
80%
3.2
Oct
M
5
£1,200
50%
2.5
Nov
L
4
£900
30%
1.2
Dec
L
3
£900
30%
0.9
H
1
£1,500
100%
1
Jan
L
4
£900
25%
1
Feb
L
4
£900
25%
1
Mar
L
4
£900
25%
1
Total
52
28
Gross income
£37,590

N.B. All figures are estimates and have been compiled using the standard relevant industry published information.

Breakdown of Annual Service Costs Are as follows:

Service Charge - £3,350 pa plus VAT

Landscaping and grounds maintenance
£150 pa
Water and sewage
£250 pa
Fire and safety testing
£55 pa
Window cleaning
£400 pa
Carpets cleaned
£250 pa
Oven cleaned
£70 pa
Internet
£240 pa
Insurance – property, public and products liability, contents and business interruption
£600 pa
Electricity - public environs
£40 pa
24 hr security
£250 pa
PAT testing
£80 pa
Fixed wire electric testing (5 years)
£100 pa
Boiler serviced
£150 pa
Wastage management
£200 pa
Pest control
£110 pa
Administration
£250 pa
Bank charges
£30 pa
Sundry
£125 pa

N.B. Costs are estimated and are likely to change from year to year.

Find out More

Get in touch or find out more about the residences