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Posted Fri, 03 Jan 2025 12:41:34 GMT by Philippa Sheridan
Hi, can a period of grace election be claimed in the first tax year of new ownership? The property was an FHL in 22/23 (and many prior years) when owned by previous owner. Purchased 23/24 and did not meet the letting days in first 12 months of ownership (or 23/24 tax year for that matter). I note guidance says a property ceases to be an FHL when it is sold, so looking for clarification. Or whether under new ownership it can not be classed as an FHL until it meets all the criteria (ignoring the upcoming changes to FHLs!) Many thanks.
Posted Mon, 20 Jan 2025 09:16:28 GMT by HMRC Admin 8 Response
Hi,
PIM4110 (Property Income Manual), clearly states that the conditions for a new let are applied for the first 12 months from when the letting began. There is a period of grace election and information can be found concerning this aspect at:
PIM4110 - Furnished holiday lettings: qualifying tests for 2011-12 onwards (IT and CT) - HMRC internal manual - GOV.UK.
If you wish to apply for the election, follow the instruction at:
PIM 4110
There is a time limit to make an application for a period of grace.
Thankyou.

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