In this week’s Q&A, David Woolley, tax consultant at Croner-i, considers the tax compliance issues when using business asset disposal relief for furnished holiday lettings
I am aware that business asset disposal relief (BADR) applies to furnished holiday lettings but note that to qualify for BADR there must have been a qualifying letting for two years up to the date of disposal. How does this rule work for my clients who have a number of furnished holiday lettings who may decide to sell only one or two?
Property letting is not a ‘trade, profession or vocation’ within section 169S Taxation of Chargeable Gains Act 1992 (TCGA 1992) but s241(3A) states that BADR can apply by virtue of s241(3)(a) and (b):
(a) any UK property business which consists of, or so far as it consists of, the commercial letting of furnished holiday accommodation shall be treated as a trade; and
