The Book-keepers Forum (BKF)
The Book-keepers Forum (UK) -> General Book-keeping & Accounting -> Furnished holdiay letting & B&B in same house - how do you treat it?
Post Info TOPIC: Furnished holdiay letting & B&B in same house - how do you treat it?
Jane


Veteran Member

Status: Offline
Posts: 85
Date:
Furnished holdiay letting & B&B in same house - how do you treat it?
Permalink  

I have a client who has a self contained annex to her home which she rents out as a holiday let as well as having B&B in her own home.  I assume the annex should be treated as furnished holiday lettings and the B&B treated as a self employed business.

Realise this may sound like a simple question but I just wanted clarification before I started working on the expenses so I can make sure I treat them correctly.

Thanks
J




__________________
Shamus


Forum Moderator & Expert

Status: Offline
Posts: 11981
Date:
Permalink  

Hi Jane,

sounds like a CGT nightmare. Hope your clients not planning to sell up anytime soon!

I think that your approach is correct in that you're treating the two entities totally separately.

Just to confirm though, the furnished holiday let is completely separate? Different front door, different address, etc.

I know of one case where someone had a semi detached bungalow and owned both sides so to all intent and purpose although one property they were two separate entities and the one was indeed a furnished holiday let.

If they're actually the same address (perhaps a converted garage) then the separate front door argument should apply but you're then into a nightmare over interest expense on any loans against the property.

You really need a better answer from someone whose dealt with a similar case but here's hoping that my reply prompts some disagreements.

As an addition to the above, this is also probably accountant rather than bookkeeper territory as one is going beyond recording the transactions and really advising the client on tax matters.

cheers,

Shaun.

__________________

Shaun

Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
BackOfficeGroup


Guru

Status: Offline
Posts: 882
Date:
Permalink  

Hmm, an interesting one.

As Shaun has said, does the annex share an entrance. A different slant on this is that it is part of the hospitality sector and the annex could just be seen as booked on a room only basis and not a holiday let property, as it is an annex to the main building and not a building in its own right. And, seeing as the main business is B&B, it makes sense to run the two as part of the same business. The you would have no trouble with interest on loan payments etc

CGT is going to apply whatever, as the whole property is used for business purposes.

P

__________________
Jane


Veteran Member

Status: Offline
Posts: 85
Date:
Permalink  

Thanks for your input.

The annex has a seperate entrance but does not have a seperate address.  I live in an area that is full of B&B and holiday let businesses so really need to get my head around tax differences as I am sure that over the next few years I am bound to gain a lot of clients in these businesses.  This one caught me out because the self catering business is part of her home and not seperate as most are.

I intend to ask some more questions and do some more digging. But any other comments would be greatfully received.

J

__________________
Page 1 of 1  sorted by
 
Quick Reply

Please log in to post quick replies.
The Book-keepers Forum (UK) -> General Book-keeping & Accounting -> Furnished holdiay letting & B&B in same house - how do you treat it?
Tweet this page Post to Digg Post to Del.icio.us
Members Login
Username 
 
Password 
    Remember Me  
©2007-2024 The Book-keepers Forum (BKF). All Rights Reserved. The Book-keepers Forum (BKF) is a trading division of Bookcert Ltd. Registered in England Company Number 05782923. 2 Laurel House, 1 Station Rd, Worle, Weston-super-Mare, North Somerset, BS22 6AR, United Kingdom. The Book-keepers Forum and BKF are trademarks of Bookcert Ltd. This forum is a discussion forum only. There will usually be more than one opinion to any question and any posting should not be viewed as a definitive solution. No responsibility for loss occasioned to any person acting or refraining from action as a result of any posting on this site is accepted by the contributors or The Book-keepers Forum. In all cases, appropriate professional advice should be sought before making a decision. We reserve the right to remove any postings which are offensive, libellous, self-promoting or engaged in covert marketing. We will not notify users of removals. The views expressed in the forum posts are those of the individual and do not necessary reflect or agree with those of The Book-keepers Forum. Any offensive or unsuitable posts will be removed by the moderators. Any reader of this forum can request for a post to be looked into by sending an email to: bookcertltd@gmail.com.

Privacy & Cookie Policy  About