Spring Budget 2024 – Chancellor attacks holiday rentals and Multiple Dwellings Relief

This will help to destroy the holiday let industries in many seaside towns that were economic deserts with no jobs 20 years ago. Massive numbers of service industry jobs were created in dead and rotting seaside towns. Now local people are complaining they can’t buy a house in their own rejuvenated towns but have forgotten that 20 years ago they had no jobs.
No holiday let landlords are going back to the PRS sector that has already been ruined.
Planning permission for holiday lets is insanity and is just making more money for corrupt local councils.
We need to build flats on the edge of towns just like they do in Europe.
The two-faced Tories are practicing divide and conquer against all landlords whilst they are importing 700,000 immigrants a year to falsify economic growth as it creates a high demand for services.
This has massively fuelled inflation and the profits of big service industry.
I recently had a £25k repair bill after tenants wrecked my BTL property. They were running an import business from the house and used it as a warehouse. This wiped out the profit that I had from the last 5 years, and I never put their rent up. Who the hell needs an end to Section 21 when it’s difficult enough to get rid of them already. Gove is a total madman.
Direct Line are ending their rent guarantee insurance for rent nonpayment due to the uncertainty around the end of section 21 evictions.
Personally, I’m selling up and leaving the country, as I can make two to three times the rent from foreign properties or a 7% yield from a foreign bank account in return for doing nothing. The current loony left Conservatives have destroyed the BTL sector already and lost one million landlords and £2 billion in revenue for HMRC.
We are run by complete madmen megalomaniacs who are destroying our country.

Sorry everyone, I see that the government has stuffed up... again and this time on holiday lets. But why is the only choice for 'holiday letters' to return the properties to long term lets where obviously they won't be any better off or 'head for the door'? If I'd moved my properties into holiday lets and it was successful then my first approach here would be to increase the letting charges. No sec13 and only once a year rises to worry about, just put up the prices and see if the interest is there surely?

Paying tax on profits not costs is not "tax relief" rather how every other UK business operates. That Treasury fiction must go. It is institutional discrimination against property owners not to be fairly treated like any other UK business.

Instead of taking the much needed opportunity to revive the PRS this chancellor has chosen to break FHL as well.

Tenants will not benefit from this and visitors will just stay at home rather than pay the extra costs.

Net result less tax, more homeless.

Tory government: dead men walking. W⚓️s

Despite today’s budget, I’m going to look at holiday lets again.

I don’t have mortgages to worry about. I assume I’ll be able to offset running costs (furniture, cleaning, maintenance).

I’m a lower rate taxpayer.

I could earn £6k gross or around £3.5k net of tax and costs with a long term tenant. But with the risks that a tenant carries. As a holiday let, I could reasonably expect £8k gross (40% occupancy) and £3k net but without long term tenant risks.

With many holiday let owners likely to exit the market, there’ll be more demand for holiday lets.

The numbers may not stack properly but it’d be worth it just to scupper the government’s plans.

24% CGT will be short lived as Labour will pump it up to 40%+ anyway. Thereby halting the exit of PRS LLs.

Hunt was never going to revoke s24 as he is a LL and Labour would take him apart at the dispatch box for conflict of interest even though he gives all money from rentals to charity.

Reply to the comment left by JohnCaversham at 06/03/2024 - 14:27
It is pretty clear in the gov website summary. FHL will be abolished and the treatment of the income will now be the same as long term lettings. FHL is income tax only. Corporation tax is unaffected. Of course more detail may be announced, but that is the position today.

Reply to the comment left by Richard P at 06/03/2024 - 15:41
VAT is based upon the type of supply. Long term letting is exempt. Short term letting is a vatable supply. There are more detailed rules regarding this supply, for example letting for more than 30 nights becomes exempt. FHL is income tax, by scrapping FHL there is no automatic assumption the vat position will change. Long term investors with commercial elements to their portfolio are familiar with dealing with VAT on long term lettings. What will become a consideration is the incorporation of a serviced accommodation business. For vat reasons amongst others, it would be best to be kept in a different limited company than a long term let portfolio, but the opportunity to switch use and therefore move assets between companies will require specific structuring.

Reply to the comment left by Mark W at 06/03/2024 - 16:36And it will only get worse if a government of another colour gets in in November.
As I said to the unlucky local councillor who knocked on my door yesterday LAs and government have to work with landlords not against them. Many Landlords are doing the job of housing those they cannot, especially when those seeking economic not political asylum are being given priority over those already on long housing lists.
Think we are sitting on a powder keg!

No point in moaning, do you think Labour will reverse the situation WHEN (not if) they get in - they may reverse the 24% CGT though. Labour (and the other insignificant parties) will view this as opportunity for more local homes (you didn't hear Starmer complain about this part of the budget did you)

If you purchase a holiday let property via a limited company presumably you can still claim all your mortgage interest as an expense and not be affected by Section 24 ? Is this correct ?