Getting a good tax deal on your holiday home
Saturday 14 February 2004
This year we will not be using our holiday home and have been told that it will rent well over holiday periods. If we do rent it, are we liable for tax on the rental? Can we claim the expenses of ownership as tax deductions?
By The LandlordThe rental will be taxable income. It will need to be declared in the property owner's tax return for the tax year in which the property is rented.
Tax deductions can be claimed for yearly expenses such as rates, maintenance, insurance and interest on borrowings for the acquisition of property.
Deductions for expenses are claimed in proportion to the number of months the property is available for renting out. For example, if the property is available for renting for only one month in the relevant tax year, only one-twelfth of each expense would be deductible.
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