Government forcing landlords to house non-paying tenants for lengthy periods11:18 AM, 15th September 2020
About 4 days ago 39
Hi, I would like to clarify something to do with the disposal/cease of an Furnished Holiday Letting (FHL) property business with relation to the Annual Investment Allowance (AIA) I intend to claim at the outset of the business. If I have only one FHL and I’m told that the AIA I can claim would amount to 10-25% of my property purchase price. If this figure ends up being, for example, £50k then I understand the tax on my income will be offset year on year from the £50k, until the whole £50k pot has been used up.
The issue I don’t understand, even after reading the HMRC documents on writing down allowances and balancing charges, is how things are wrapped up after I want to end the business and sell off the property. I’m worried that the benefit of having a significant capital allowance now will lead to a large tax liability when I end this FHL business/sell the flat. Does anyone have any examples of how this works in reality and, crucially, how I can retain the current tax benefit from this relief without having to eventually pay a ‘charge’ at the end?
Many thanks for your input
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