It's hard to predict exactly what tax changes the Autumn Budget on 30 October will bring, but we do already know of one change coming next year – and it spells bad news for the owners of holiday properties.
Currently, if you make a property available to rent for at least 210 days a year, and effectively let it out at least half of that time (ie, 105 days), your holiday home could qualify as a furnished holiday letting and enjoy various tax advantages. However, from April 2025, these properties will be treated just like regular buy-to-lets. The change was first announced by former chancellor Jeremy Hunt in the Spring Budget earlier this year, and later confirmed by the current government.
The shift will impact you more significantly if you have a mortgage on the property. At present, you can get full tax relief on the mortgage interest; as of next tax year, you will only get a 20 per cent tax credit, so you will lose out if you are a higher or additional-rate taxpayer.