Sykes Holiday Let Owner Saves over £25k on Tax with Zeal

If you're setting up a holiday let with a property that you've purchased, then there's a chance that you might be overlooking potential savings worth thousands of pounds.

This was the case for Sykes property owner Rachel and her two properties, Esme’s Cottage and Harriet's Cottage.

Luckily, Rachel met tax experts Zeal at a Sykes Holiday Cottages event, and they were able to assist her in making a claim resulting in a cash refund and thousands in tax savings.

Read on to find out how Rachel made a successful claim with Zeal.

How did you come to make claim on your holiday let property with Zeal? 

“I actually heard of Zeal through Sykes; I hadn’t realized you could claim for capital allowance.” - Property Owner Rachel 

After meeting at a Sykes event, owner Rachel arranged a consultation with Zeal.

Zeal’s experts determined that both Rachel’s holiday cottages ticked all the boxes for a tax relief claim on the ‘embedded fixtures’ according to UK Tax legislation.

About the properties 

“I had one of the cottages on the market to sell, but Zeal said I could still claim. The other one, Harriet’s Cottage, had been on with Sykes since 2018, I purchased the property in 2016 and spent a year and a half renovating it.” - Property Owner Rachel 

Harriet’s and Esme’s Cottages are situated near Whitby, North Yorkshire. Harriet’s Cottage is an endearing, end-terrace property, while Esme’s Cottage is a charming stone-built holiday home.

Acquired for a collective sum of £327,850, these residences have undergone meticulous renovations, preserving numerous original features such as beamed ceilings, aged timber floors, and paneled walls, all contributing to their distinctive character.

Claims process 

 “The process was so straightforward; I spoke with someone from Zeal answered questions and sent in my previous year's tax returns.” - Property Owner Rachel 

What is the claims process? 

1. Initial Consultation 

2. Validation 

3. Survey 

4. Capital Allowances Report (CAVR) 

5. Submission 

The team at Zeal conducted a survey of the properties and complied a report detailing the unclaimed allowances and the potential tax savings. The report was sent to the owner for review and once happy, Zeal submitted the Capital Allowances Valuation Report to HMRC.

What items qualify as embedded fixtures?

A wide range of embedded fixtures are eligible, from electrical fixtures, heating and water systems to underground pipework. It also includes fixtures like kitchens, bathrooms, door handles, and carpets. The fixtures which Zeal were able to claim for Esme and Harriet's Cottages were:

• Lighting and electric systems  

• Carpets and flooring  

• TV and phone ports  

• Heating and ventilation systems  

• Security and fire alarms  

• Ironmongery  

• Water systems and drainage 

• Kitchens and bathrooms  

• Disposal installations 

How much was the claim worth? 

“My claim overall was £25,400 in tax savings and a cash rebate of £3000.” - Property Owner Rachel 

In total Zeal were able to identify:

• £63,500 in uncovered capital allowances

This resulted in:-

• Up to £24,400 unlocked in future tax savings

• £3,000 reclaimed as a cash rebate for overpaid tax

“It couldn’t have been easier, it didn’t take very long from start to finish, I think about 2 months. 

I would recommend Zeal and often do recommend them to owners, I think tax can be quite scary, but Zeal really made it simple.” -Property Owner Rachel 

How can Zeal help Sykes owners save money? 

If you own a holiday let or serviced accommodation property, you may be eligible to receive specialist tax relief for the inherent fixtures present in the building at the time of purchase.

Typically, Zeal can uncover unclaimed qualifying items amounting to 20%-30% of the property's purchase price. On average, this translates to tax savings of around £25,000 per property!

As an owner affiliated with the Sykes Holiday Cottages Family, you may qualify for specialist tax relief on the embedded fixtures within your holiday let, whether acquired, constructed, or renovated. Even if you incurred the expenditure several years ago, or the original fixtures have since been repaired or replaced. 

Can I make a claim with Zeal? 

Claim Criteria 

If you own a holiday let property and meet the following criteria, you may be eligible for property tax relief according to UK Tax legislation:

• You are an individual, partnership, or company that owns a holiday let property.

• Your property is available for rental for more than 210 days a year, is actually let for more than 105 days per year and is not let for more than 31 consecutive days to the same person.

• The property was acquired, constructed, or renovated for £100,000 or more and is situated in the UK or EU.

• You pay tax or will be paying tax in future on the profits made from your holiday letting business.

Claiming this property tax relief could:

• Reduce or even eliminate your next tax bill.

• Generate a cash repayment for any tax you have unknowingly overpaid.

• Unlock thousands of pounds in tax savings to mitigate future HMRC payments.

You could be due an average of £25,000 in tax relief! For an instant estimate of your tax savings, try Zeal’s tax saving calculator.

The advice above is given by Zeal. Sykes can’t advise you on, and isn’t responsible for, tax matters in relation to your holiday let, but it hopes that by pointing you in the direction of certain experts in the field, it’s starting you off on the right foot, and you can read into this matter further and seek your own advice from Zeal as and when you feel it’s needed.