New to holiday letting or looking to buy a holiday home in the West Country? We understand that holiday let finance can evoke a lot of questions, including queries about bank accounts.
Our property experts are on hand every step of the way. Here are some frequently asked questions from our holiday home owners.
Bank Accounts for Holiday Homes
Q. Do I need a separate bank account for the income from my holiday let?
Here at Helpful Holidays we always recommend you seek financial advice from an accountant. But, in general terms, putting your income from your holiday home in your current account is acceptable. It is important to note that all banks’ terms and conditions differ so do read the small print.
If you wish to use a holiday letting agent like Helpful Holidays to let your holiday home, the bank account must be in the same name as the contract to avoid any issues with money laundering.
Personal bank accounts aren’t the only option for your holiday let finances. Read on to find out more.
Q. Would you recommend a business bank account?
It is essential to keep an accurate account of income and expenditure relating to your holiday let. With this in mind, it may be advisable to open a business bank account.
A business bank account works much like a personal bank account. Opening a business bank account for your holiday home is an easy way to keep your holiday let finances separate from your own personal finances.
It is a legal requirement if you wish to set up a limited company and it will make it easier should you wish to apply for business loans.
If you wish to use a holiday letting agency, like Helpful Holidays, a business bank account must have the same contact details as the holiday letting agreement.
Q. What are the benefits of a business bank account?
There are many benefits of using a business bank account, but the main advantages include:
- Invoices are paid directly to your business account
- It keeps your holiday let finances and your personal finances separate making it easier to do your tax return
- A business bank account builds on your business’s credit history
- A good business credit history can assist when applying for business loans or financial help in the future
To find out more about which is the best business bank account for your holiday let business, visit the Money Supermarket website.
Q. Do I need to declare the income from my holiday let?
All income must be declared to the Inland Revenue (HMRC), hence the need for tidy, accurate accounts. Keeping your holiday let finances separate, in a designated account, will make it easier to manage.
If you have other income taxed on a PAYE basis, keeping the monies apart helps avoid confusion.
For further information on holiday homes, tax and all things in between read our owner advice blog.
Holiday home owner advice
It may feel like an overwhelming task when thinking about holiday let finance and a bank account for your holiday home. But, with professional advice and support you could save yourself a headache in the future.
At Helpful Holidays, our team of holiday letting experts are on hand to offer advice. We’re happy to help answer any questions you may have on a particular subject. Find out more about letting with us, request your FREE guide or call our team on 01647 433593 today.
*At the time of publishing (Jan 2022), Helpful Holidays has taken all reasonable care to ensure that the information contained in this article is accurate. But no warranty or representation is given that the information is complete or free from errors or inaccuracies. Further advice should be sought from an accountant.
