Hi Guys, Everyone with rental property in Italy will be awar...
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Hi Guys, Everyone with rental property in Italy will be aware of the need for a CIN, but first you need the local version the...
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Hi, I am looking at starting a Holiday Let home, my first toe-dip into this world!
So I'm looking at a full house holiday let - which I am not living in and would not be my main residence.
I am trying to work out a plan and all estimated expenses. One part I'm not sure of is the setup with Utility companies, it's a residential property, is it still a residential house as far as they are concerned or do i need to approach them as a business?
Also secondly, what do you do with any post? I appreciate so much is paperless now but for any post that does arrive (possibly something important?) how can you organise this so all post comes to your main residence always? (Royal Mail only appear to do a paid service of up to 12mnths ('when moving home').
If any experienced UK Hosts can advise that would certainly help and very much appreciated, thank you.
1. If you are using the property only for short term rental you will need business rates for utilities, council tax, water etc. It's not a residential property if it's main purpose is offering accommodation for a fee.
2. What mail are you expecting at the property??? Any bills you can direct to go to your main address.
Thank you Helen. I have zero experience and all quite daunting, I'm just trying to make sure I understand everything.
Ok, it makes sense it's all treated as a business for utilities, that's great thank you.
Can you give any insight (purely for my cost estimating) the difference i'd expect to pay for having business accounts for utilities compared to residential. I have no experience here or idea and if I need to be mindful in my costings that these will be high overheads (compared to residential).
RE: Post - I was just trying to think of all scenarios and that sprung to mind.
The best way to get a handle on your costs is to put together a profit and loss budget.
You need to include all your start up costs ie furniture, bedding, kitchen equipment, white goods, decoration,
Then you need all your ongoing costs. You can get quotes from utility companies based on the size of your property, then include mortgage, home insurance for short term lets, business rates, rubbish collection and welcome pack you include, cleaner if you are using one etc
Then estimate how many days a year you are likely to let your place for and at what costs. That will give you your projected income.
Take your costs from your projected income and this will give you your gross profit. Allow about 20% for tax (speak to an accountant and look on the HMRC website for allowable expenses). This will give you likely profit levels.
Then you can decide whether it's worth doing.
Best of luck @Rob9645
Wow, ok, thank you for all the advice and tips there, very much appreciated,
@Rob9645 have a look at Furnished Holiday Lets on gov.uk. There is a wealth of info there on what you can offset against tax, how FHL earnings are pensionable and, unless it changes in next weeks budget, how mortgage interest can also be offset against tax (unlike long term rentals). What they don't say, but is true, is you can allocate the earnings any way you like between the owners of the property. They also don't mention capital gains tax is payable when you sell up. Talk to your local council and get the place a business rates designation and you will likely pay no rates at all but there are requirements on having a certain number of nights rented our although these are usually less onerous than the FHL requirements.
Thank you so much for the info, I'll check out the gov.uk area.