Income Tax (Trading and Other Income) Act 2005 section 326

Under-used holiday accommodation: averaging elections

Section 326 allows property owners to treat under-used furnished holiday lettings as qualifying holiday accommodation by averaging the letting days across multiple properties, provided certain conditions are met.

• Property that meets all conditions for qualifying holiday accommodation except the 105-day letting requirement is termed "under-used accommodation" and may benefit from an averaging election.
• An owner may elect to group qualifying holiday accommodation with under-used accommodation; if the average number of commercially let days across the selected properties is 105 or more in the relevant period, the under-used properties are treated as qualifying.
• The same qualifying holiday accommodation cannot be included in more than one averaging election for the same tax year, and UK and EEA properties must be considered separately.
• The election must be made on or before the first anniversary of the normal self-assessment filing date for the tax year in question.