While the pandemic may have accelerated the rise of staycations in the UK, there are a number of other factors at play that suggest the boom in staycations are here to stay from Brexit to a rise in sustainable tours! Here, West One look at some of the potential benefits of investing in a holiday let…

  • The cost of furnishing a holiday rental can be deducted from the pre-tax profits.
  • Self-catering accommodation may be subject to Business Rate property tax, which would allow the investor to claim small business rate relief, instead of paying council tax.
  • If an investor decides to sell their property, they will be able to claim certain Capital Gains Tax reliefs including Entrepreneur’s Relief, Business Asset Rollover Relief and Gift Hold-Over Relief.
  • Income generated from a holiday rental is classed as ‘relevant earnings’ which means you can make contributions towards your pension and reduce your income tax bill.
  • Married couples can divide the profits from a furnished holiday let however they choose, regardless of the ownership split.
  • There is the potential for higher profit margins as the daily and weekly charges for holiday lets are considerably higher than traditional buy-to-lets.

Financing a holiday-let with West One

Our specialist buy-to-let product range is available for existing or first-time landlords wishing to finance holiday lets in their personal names or through a limited company SPV.

Key features of our Holiday Let mortgages:

  • We lend to first time landlords with no holiday letting experience.
  • Available to individuals, limited companies, and expats.
  • No minimum income.
  • We can accommodate short term lets and serviced accommodation (Airbnb) which means the property does not have to be in a typical holiday destination.
  • Holiday lets are assessed on an AST rental basis.
  • The property must be suitable for standard AST rental.

If you have a client looking to purchase or remortgage a holiday buy-to-let, please contact your BDM or the broker support team on 0333 123 4556 or email btlbrokersupport@westoneloans.co.uk.

Generic information is contained within this article and each individual’s tax affairs are different, further advice should be sought from an accountant.