The window to claim Capital Allowances tax relief on Furnished Holiday Lettings (FHLs) is fast closing before repeal of the legislation in April 2025 and HMRC have now clarified the transitional rules about who can or can’t claim.
- Expenditure must be incurred by April 2025
- Existing FHL businesses can keep claiming existing allowances beyond April 2025
- For new FHL businesses in year end 24/25 the occupancy conditions begin on the day that letting commences
For example, where a property is first available for letting on 1 January 2025 the relevant period for occupancy rules will be 1 January 2025 to 31 December 2025 and applies to both individuals and companies.