Short-term let accounting questions, answered.

We are the accounting arm of the STL Solutions group, and we act only for short-term let and holiday let operators across the United Kingdom: individual hosts, portfolios, limited companies and the agencies that manage properties for others. All accounting and tax work is reviewed and signed off by Aspiration Accounts, an HMRC-registered accountancy firm, so every filing has a regulated practice behind it.

The tax position of a short-term let changed more between 2024 and 2026 than in the previous twenty years: the furnished holiday lettings regime was abolished, Making Tax Digital reaches most landlords, local visitor levies and registration schemes arrived, and business rates were revalued. A general practice meets these questions occasionally. We meet nothing else, so the advice is specific to your property, your mortgage and your plans rather than a rule of thumb.

Whatever you have, in whatever state. Booking exports from each platform, bank and card statements, supplier invoices, photographs of receipts, and forwarded emails all go into one upload box in your client account, or you can email them. Exports are read automatically; everything else is reviewed by a bookkeeper within two working days. We ask you a question only when something cannot be placed.

No. We keep your books in cloud accounting software and the subscription is included in your plan. If you already use Xero, QuickBooks or FreeAgent we can work in your existing file as your adviser rather than moving you, provided the records are usable. Either way you see your figures through your client account.

Sign up, then tell us who your current accountant is. We write to them for professional clearance and ask for your records, which is the standard process between practices and usually takes a week or two. There is no gap in cover: if a filing falls due during the handover we prepare it from the records you give us.

Yes. We rebuild the year to date from platform exports and bank statements, and pick up from there. Where more than one earlier year needs to be brought up to date we quote a fixed catch-up fee before starting, so there is no open-ended bill.

At sign-up you authorise us to act as your agent. For Self Assessment that is HMRC's online agent authorisation; for Making Tax Digital it is a digital handshake through our agent services account. Each takes you a few minutes and we guide you through it. We prepare every filing, you approve it, and only then is it submitted.

Email questions are answered within two working days on every Accounts plan, and usually sooner. Accounts + Support adds telephone advice on the same working day and an annual review of your whole tax position. Questions about a specific transaction are dealt with as part of the bookkeeping, at no extra charge.

From 6 April 2025 your letting income is part of a UK property business rather than a separate trade-like activity. The main consequences are that mortgage interest and other finance costs are no longer deducted in full but relieved as a 20% tax reduction, new spending on furniture and equipment no longer qualifies for capital allowances, profits no longer count as earnings for pension contributions, and the capital gains reliefs that FHLs enjoyed, such as business asset disposal relief and rollover relief, no longer apply to future disposals. The first Self Assessment return under the new rules, for 2025/26, is due by 31 January 2027.

For individuals, finance costs on a let property are no longer an expense. Instead you receive a tax reduction equal to 20% of the interest, which can leave higher-rate taxpayers paying tax on profit they have not made. Limited companies continue to deduct interest in full, which is one reason the company question has become more common. We model both on your actual figures before recommending anything.

Existing pools are not lost. You continue to claim writing-down allowances on expenditure incurred before 6 April 2025 until the pool is exhausted. New spending on furniture, white goods and fittings is instead covered by replacement of domestic items relief, which gives a deduction for like-for-like replacements but not for the initial purchase. We keep the pool schedule and apply the right relief to each item you send us.

Yes. Losses carried forward from the FHL business are not lost at the transition. They are carried into your UK property business and set against future profits from it, which may now include ordinary buy-to-let income as well.

Income from property held jointly by spouses or civil partners is taxed 50:50 by default, whatever the actual ownership shares. If you hold the property in unequal shares and want to be taxed on them, HMRC needs a Form 17 declaration with evidence of the beneficial ownership. Under the old FHL rules you could choose any split; that flexibility went with the regime, so it is worth reviewing.

Usually, yes. Letting furnished rooms in your main residence can fall within rent-a-room relief, which exempts the first £7,500 of gross receipts a year (£3,750 if shared with another recipient). Above that you can choose between the relief and ordinary expenses. A whole property, or a separate annexe, does not qualify.

Yes. Since January 2024 UK digital platforms have been required to collect sellers' details and report income to HMRC each January, and HMRC uses that data to check returns and to write to hosts who have not declared. Our figures reconcile to the platform reports, so what you file matches what HMRC already holds.

Gains on UK residential property are taxed at 18% and 24% and must be reported, with the tax paid, within 60 days of completion, separately from your annual return. Business asset disposal relief and rollover relief are no longer available for former FHLs, subject to transitional rules for contracts made before 6 March 2024. If a sale is in prospect, tell us early; the timing and the ownership can both affect the bill.

It applies to sole traders and landlords by reference to qualifying income, which is gross rental and self-employment income before expenses. The threshold is £50,000 from 6 April 2026, £30,000 from April 2027 and £20,000 from April 2028, tested on the tax return two years earlier. A host with one well-let property can be over £30,000, so most of our clients are in by 2027.

Digital records, a summary of income and expenses sent to HMRC each quarter through compatible software, and a final declaration by 31 January that replaces the Self Assessment return. The quarterly updates are not tax calculations and carry no payment; they are a running summary. Because we keep your books month by month, the updates are produced from the records we already hold and submitted for you.

Each owner whose own qualifying income exceeds the threshold is in MTD in their own right. HMRC allows jointly held property income to be reported quarterly without the expense detail, with expenses added at year end, which simplifies matters for couples. We set this up for both owners together.

In Scotland, Edinburgh's 5% levy applies to stays from 24 July 2026, with Glasgow following from January 2027 and other councils, including Highland and Aberdeen, consulting. In Wales, the Visitor Accommodation (Register and Levy) Etc. (Wales) Act 2025 lets each council introduce a per-night charge from April 2027 at the earliest, at £1.30 a person a night (75p for hostels and campsites). England has no statutory visitor levy at present, although some cities operate a voluntary charge through accommodation business improvement districts. Northern Ireland has no levy.

It is 5% of the accommodation charge, excluding VAT and the levy itself, for the first five nights of each stay. Operators file a return each quarter on visitorlevy.scot, keep 2% of what they collect towards their costs, and pay the balance to the Council. Records must be kept for five years. The first return, for stays to 30 September 2026, was due in October 2026, with payment the following month.

If you are VAT-registered the levy forms part of your taxable supply, so VAT is charged on the levy as well as the room. You may itemise it on the guest's bill or absorb it in your price; either way it is 5% of the accommodation element. The treatment of platform commission is left to the operator by the guidance, so we record which basis you use and every return states it.

Yes, on Levy Submission Service and on every Accounts plan. You give us a signed authority at sign-up, we prepare the return from your booking exports, you approve it, and we submit it as your agent and send you the Council's confirmation and the amount to pay. If you prefer to file yourself, Levy Self-Service gives you the exact figures to enter.

Holiday and short-term accommodation is standard-rated, unlike residential letting, so it counts towards the registration threshold of £90,000 of taxable turnover in any rolling twelve months. We track your rolling total and warn you well before you reach it, because the difference between registering voluntarily at a time of your choosing and being caught late can be substantial.

The flat rate scheme for hotels and accommodation, at 10.5% of gross turnover, is often simpler for a single property with few costs. Standard VAT accounting reclaims input tax on refurbishment and running costs and can be better for larger operators. Whether the Tour Operators' Margin Scheme applies to operators who rent properties from owners and let them on has been contested since the Sonder litigation; we advise on each case rather than assuming. Cleaning fees and other charges to guests are part of the taxable supply.

A self-catering property is rated as non-domestic only if it meets the letting tests: in England and Scotland, available for 140 nights and actually let for 70 in the year; in Wales, available for 252 and let for 182. Pass them and you pay rates, often reduced to nil by small business relief; fail them and you pay council tax, in many areas with a second-home premium of up to 100% (up to 300% in Wales). The 2026 revaluation moved many properties, so the choice needs working out property by property, which we do as part of the Accounts plans.

In Scotland every short-term let needs a licence from the local council, renewed every three years, and in Edinburgh's control area a change of use also needs planning permission. Wales is introducing a statutory registration scheme under the 2025 Act. England is setting up a national registration scheme under the Levelling-up and Regeneration Act. In Northern Ireland tourist accommodation must be certified by Tourism NI before it is let. Licence and registration fees are allowable expenses, and listing platforms increasingly require the number on your listing.

Sometimes. A company deducts mortgage interest in full and pays corporation tax at 19% to 25%, but moving an existing property in can trigger capital gains tax and stamp duty, land and buildings transaction tax or land transaction tax, and taking profits out is taxed again. Companies holding dwellings worth over £500,000 also need to claim relief from the annual tax on enveloped dwellings each year. The answer depends on your other income, your borrowing and how long you intend to hold, so we model it on your numbers before you decide.

Yes. On Portfolio and Agency plans you get a profit and loss for each property and for the whole, with platform payouts matched to each property's bookings. Tax is still assessed on the property business as a whole, but the per-property view is what tells you which units are earning.

Yes. The Agency plan covers up to fifteen properties with a monthly owner statement for each, reconciliation of client money, and separate records where you trade through more than one entity. Above fifteen properties, or where there are several companies, we agree a fixed fee for the whole operation after a short call.

By monthly subscription, taken by card through Stripe, with the two levy-only plans also available quarterly. Prices exclude VAT. Every plan includes a set number of properties and a fixed price for each additional one, so you can see the cost before you start. There is no onboarding fee; the only extra is a quoted catch-up fee if more than one earlier year needs to be brought up to date.

Yes, at any time, from your client account. Monthly plans end at the end of the month in which you cancel and quarterly plans at the end of the quarter. You keep access to every return, every set of accounts and all the workings behind them.

Booking exports contain guests' names, so we treat them with care: they are used only to prepare your figures, are seen only by the team doing your books, and are retained for six years, which covers HMRC's record-keeping requirement and the five years required for visitor levy returns. Bank statements and invoices are handled the same way. We never use guest details for marketing or share them with anyone else.

HMRC requires records supporting a Self Assessment return to be kept for at least five years after the 31 January filing deadline, and VAT records for six years. Visitor levy records must be kept for five years. Because everything you send us is stored in your client account, the retention is handled for you.