Furnished Holiday Let Calculator
Understand how the abolition of the FHL tax regime from April 2025 affects your holiday rental property. Compare old and new tax treatments.
FHL Regime Abolished
The Furnished Holiday Lettings tax regime ended on 6 April 2025. FHL properties are now treated as standard residential lets, losing preferential tax treatment for income tax, Capital Gains Tax, and pension contributions.
What are Furnished Holiday Lettings (FHL)?
FHL is a special tax status for UK or EEA properties let commercially as furnished holiday accommodation. Properties must meet specific availability and letting conditions. However, the FHL tax regime was abolished from April 2025.
What changed for FHL from April 2025?
The FHL tax regime ended on 6 April 2025. This means: no more beneficial capital allowances treatment, loss of CGT reliefs (Business Asset Disposal Relief, rollover relief), rental income now treated as investment income (not trading), and mortgage interest restricted to basic rate relief.
Can I still claim Capital Gains Tax reliefs?
From April 2025, most CGT reliefs for FHL are gone. Business Asset Disposal Relief (10% CGT rate) and rollover relief no longer apply to FHL properties. Standard residential property CGT rates (18%/24%) now apply.
How is mortgage interest treated now?
Mortgage interest on FHL properties is now restricted like other residential lettings. You get a 20% tax credit rather than full deduction against income. This can significantly increase your tax bill if you have substantial mortgage interest.
Should I sell my FHL property?
This depends on your individual circumstances. Consider: current market value vs purchase price, your marginal tax rate, alternative investments, and whether you want to continue in the holiday let business. Seek professional advice for your specific situation.