Income Tax (Trading and Other Income) Act 2005 section 327

Relief: UK property business

Section 327 requires separate profit calculations for the furnished holiday lettings part and the other part of a UK property business, so that the special tax advantages available to qualifying holiday lettings can be properly applied.

• Where a UK property business includes both furnished holiday lettings and other property activities, each part must be calculated separately when certain conditions are met.
• Separate calculations are required if capital allowances or charges under sections 248 or 249 of the Capital Allowances Act 2001 apply to either or both parts of the business.
• Separate calculations are also required if any loss relief provision under Part 4 of the Income Tax Act 2007 applies to a loss made in either the furnished holiday lettings part or the other part.
• Where a property is used partly as holiday accommodation and partly as regular accommodation, just and reasonable apportionments must be made for the purposes of these calculations.