Entrepreneurs Relief on furnished holiday letting properties

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We have recently advised on a case where a furnished holiday let cottage is being sold, from a small portfolio of such properties.  A key question on such an arrangement is whether Entrepreneurs Relief (ER) applies on the sale of a single property from such a business.  For ER to apply there must be an operable business being sold.  A single cottage could be operated as a FHL business so yes it is an operable business.  However if the taxpayer is merely selling a “business asset” rather than a “part of a business” then ER will not apply.  This can depend on what remains – if the business is large enough such that it is generally unaffected then ER may not apply because of this.

As with all of our tax tips and web pages this information is necessarily summarised and of a general nature.  If you would like detailed specific advice please contact us.