Section 17: Furnished holiday lettings businesses
135.This section is based on section 29 of CAA 1990. It defines furnished holiday lettings businesses.
136.Subsection (3) applies the definition in section 504 of ICTA. This approach is taken here (and in some other places in the Act) in order to:
make clear that precisely the same definition is used; and
avoid duplication of legislation (with the risk that the definitions may diverge if one is amended but not the other by accident rather than design).
137.The vast majority of readers have access to that legislation. Increasingly they have electronic access (with hyperlinks to such cross-references). But for ease of reference in these notes:
Section 504 of ICTA (Supplementary provisions)
“(2)A letting—
(a)is a commercial letting if it is let on a commercial basis and with a view to the realisation of profits; and
(b)is of furnished accommodation if the tenant is entitled to the use of furniture.
(3)Accommodation shall not be treated as holiday accommodation for the purposes of this section unless—
(a)it is available for commercial letting to the public generally as holiday accommodation for periods which amount, in the aggregate, to not less than 140 days;
(b)the periods for which it is so let amount in the aggregate to at least 70 days; and
(c)for a period comprising at least seven months (which need not be continuous but includes any months in which it is let as mentioned in paragraph (b) above) it is not normally in the same occupation for a continuous period exceeding 31 days.
(4)Any question whether accommodation let by any person other than a company is, at any time in a year of assessment, holiday accommodation shall be determined—
(a)if the accommodation was not let by him as furnished accommodation in the preceding year of assessment but is so let in the following year of assessment, by reference to the 12 months beginning with the date on which he first so let it in the year of assessment;
(b)if the accommodation was let by him as furnished accommodation in the preceding year of assessment but is not so let in the following year of assessment, by reference to the 12 months ending with the date on which he ceased so to let it in the year of assessment; and
(c)in any other case, by reference to the year of assessment.
(5)Any question whether accommodation let by a company is at any time in an accounting period holiday accommodation shall be determined—
(a)if the accommodation was not let by it as furnished accommodation in the period of 12 months immediately preceding the accounting period but is so let in the period of 12 months immediately following the accounting period, by reference to the 12 months beginning with the date in the accounting period on which it first so let it;
(b)if the accommodation was let by it as furnished accommodation in the period of 12 months immediately preceding the accounting period but is not so let by it in the period of 12 months immediately following the accounting period, by reference to the 12 months ending with the date in the accounting period on which it ceased so to let it;
(c)in any other case, by reference to the period of 12 months ending with the last day of the accounting period.
(6)Where, in any year of assessment or accounting period, a person lets furnished accommodation which is treated as holiday accommodation for the purposes of this section in that year or period (“the qualifying accommodation”), he may make a claim under this subsection, within the time specified in subsection (6A) below, for averaging treatment to apply for that year or period to that and any other accommodation specified in the claim which was let by him as furnished accommodation during that year or period and would fall to be treated as holiday accommodation in that year or period if subsection (3)(b) above were satisfied in relation to it.
(6A)The time mentioned in subsection (6) above is—
(a)in the case of a claim for the purposes of income tax, the period ending with the first anniversary of the 31st January next following the year of assessment in which the accommodation was let;
(b)in the case of a claim for the purposes of corporation tax, the period of two years beginning at the end of the accounting period in which the accommodation was let.
(7)Where a claim is made under subsection (6) above in respect of any year of assessment or accounting period, any such other accommodation shall be treated as being holiday accommodation in that year or period if the number of days for which the qualifying accommodation and any other such accommodation was let by the claimant as mentioned in subsection (3)(a) above during the year or period amounts on average to at least 70.
(8)Qualifying accommodation may not be specified in more than one claim in respect of any one year of assessment or accounting period.
(9)For the purposes of this section a person lets accommodation if he permits another person to occupy it, whether or not in pursuance of a lease; and “letting” and “tenant” shall be construed accordingly.”
138.Subsection (4) provides for all necessary apportionments under this Part if only part of accommodation is holiday accommodation.
