Capital Allowances on FHLs

Good morning, Are we able to get clarification on the state of Capital Allowances claims for FHLs following the budget announcement? I know we are awaiting draft legislation also, do we have timeframes on this? Will the ability to claim cease in April 2025, and what will happen to those claiming via WDAs?

Hi,
Under the terms of the Spring Budget announcement the current rules for Furnished Holiday Lettting will be repealed from April 2025.
Furnished Holiday letting was treated as a trade for the purposes of giving allowances on plant and machinery used inside the property such as furniture and white goods.
These will no longer be available but where expenditure was pooled for previous years , any remaining allowances may continue to be claimed until the pool is extinguished.
Thank you.

To confirm, does this mean if businesses make a Capital Allowances claim under the FHL criteria, they will be able to claim in full and write down all allowances, providing the claim is submitted before April 2025? Does this also mean for say a claim for YE 5th April 2025, could be made in full and AIA claimed if appropriate? Additionally, by extinguished, does this mean that you can claim up until the allowances have been claimed in full and the pools empty, or is it a case that you can no longer claim at all, even via the pools from April 2025. Example 1: Company A has a 31st December YE and identifies additions to PMAs on their FHL in the YE 31st Dec 2023 of £100k. Can they continue to write down these allowances beyond April 2025 as per standard WDA rules? Is the new legislation essentially saying that any CA additions on FHLs cannot be made from April 2025, but any existing CAs (i.e. additions before April 2025) can continue to be written down as normal? Example 2: if i have a client who started claiming in YE April 2024, but they have WDA's until YE 2026, can they claim the WDA's in 2026, or will the WDA's be restricted to the point in YE 2025? Further to this, do any existing FHL losses created by CAs get carried forward to be offset against future FHL profits beyond April 2025?

Hi,
 

Thank you for your questions. The questions you are asking are not really suitable for this forum as the subject matter is appropriate to a Technical Inspector. Could I suggest that you put your questions in a letter so it can be reviewed and answered in full by an Inspector. Please send your letter to HMRC,                                          BX9 1AS, United Kingdom. Thank you .