Tourist Industry to Lose £200 Million
Posted on December 10, 2009
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UK holiday home owners, who rent their house out for a large portion of the year, are to be hit by new stealth taxes in 2010. The new taxes look to affect over 60,000 holiday home owners, each one being charged an extra £400 each year.
The taxes will affect those who offer their house to rent for atleast 140 days a year. The home also has to actually be rented for a minimum of 70 out of the 140 days. By the sounds of that, I wouldn’t be surprised if we saw people offering their home for 139 days a year.
The reason why these taxes will be coming in is because, according to the Treasury, the current ones break European laws. This is because currently, holiday home owners are classed as traders, meaning they pay less taxes on certain things. The new stealth taxes will mean that holiday home owners are named as investors, not traders, meaning they will have to pay more taxes.
Although this won’t be good for holiday home owners, and the tourist market, it will be good for the Government, atleast for a while. With over 60,000 UK holiday home owners being affected by the new stealth taxes, the Government looks to make a £20 million income. Despite the Government making this extra £20 million, it could prove to be worse for the Government than first appears.
The new stealth taxes won’t go down well for many UK holiday home owners. Most holiday home owners already have to pay high prices for essential things like maintenance and holiday cottage insurance. Now because of the new taxes, home owners will be making less profits, this could result in some being forced to close down. According to analysts, these taxes could result in the tourist industry loosing £200 million each year. The tourist industry won’t just be losing money though, due to the number of holiday homes that will have to close, a number of jobs will also be lost. Yet more news that won’t go down well during the current recession.
If you are after insurance for holiday homes based in the UK, or maybe overseas property insurance for your holiday home abroad, Schofields is the place to go.
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