FHL started renting on 20 March 2023 - what to do re expenses

I have a new FHL, and started to work on painting, roof repair, buying furniture etc in January 2023, but I didn't let it out till 20 March. What do I do about the expenses I have incurred and the rent for the two weeks of the last tax year? Do I just carry everything forward to the tax year starting April 2023 as it didn't meet the FHL rules last year, but will this year?

Hi Ranny Sahota,

Please see guidance at:  PIM2505 - Beginning and end of a rental business: commencement

Thank you.

 

Thanks for the link, but I do not understand the information. Can you be more specific with a response? I have added more info. I have a new FHL, and started to work on painting, roof repair, buying furniture etc in January 2023, but I didn't let it out till 20 March. What do I do about the expenses I have incurred and the rent for the two weeks of the last tax year? Do I just carry everything forward to the tax year starting April 2023 as it didn't meet the FHL rules last year, but will this year? I spent £9000 preparing my FHL from Jan - March 2023. The first tenant came 20 March 2023, BUT an FHL only happens after 105 nights and is available for 210 nights a year. Do I simply not declare this expenditure and instead save the expenses and claim them from April 2023 as this year I will qualify for FHL tax deductions.

Hi,

You have said that the FHL rules were not met in 2022 to 2023. It is not clear whether you are aware of the guidance in our property income manual which states that when looking at the occupancy tests for a new let you apply the tests for the first 12 months from when the letting began:

PIM4110 - Furnished holiday lettings: qualifying tests for 2011-12 onwards (IT and CT)

As rental income was received in the 2022 to 2023 year you would have to show the rental income on your 2022 to 2023 tax return and claim for the allowable expenses incurred.

Thank you.