Income Tax (Trading and Other Income) Act 2005 section 322

Introduction

Section 322 introduces the rules on the commercial letting of furnished holiday accommodation, explaining why these lettings receive special treatment and signposting where the relevant tax advantages are found in other legislation.

• Furnished holiday lettings within a UK or EEA overseas property business qualify for a range of specific tax advantages not available to ordinary property lettings
• The tax advantages are found across multiple pieces of legislation, including ITTOIA 2005, TCGA 1992, CAA 2001, FA 2004 and ITA 2007, covering areas such as finance cost deductions, capital allowances, loss relief, pension-relevant earnings and capital gains
• This chapter provides for the profits of the furnished holiday lettings element of a property business to be computed separately from the rest of the business, for both UK and EEA overseas property businesses
• Transitional rules in Schedule 2 to ITTOIA 2005 ensured that the former ICTA rules on "relevant earnings" continued to apply until 5 April 2006