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 home tax, read our guide.
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.
More holiday letting guides
Our expert team at Helpful Holidays have put together some holiday letting blogs to help quickly answer any questions you may have. You can browse all of our owner advice blogs here, or choose one of the related subjects below for more holiday letting tips!
The information contained in this article was accurate at the time of writing, based on our research. Rules, criteria and regulations change all the time, so please contact our prospective new owner team if you’d like to hear how. Nothing in this article constitutes the giving of financial, tax or legal advice to you; please consult your own professional advisor (accountant, lawyer etc). in this regard. If we have referred within the article to a third-party provider of unregulated holiday let mortgages, this is due to the fact that such mortgages aren’t currently regulated by the FCA. As a helpful reminder, your home may be repossessed if you do not keep up repayments on a mortgage, so again anything you decide to do in this particular area this is one on which you should take your own professional advice on too, as we aren’t providing and can’t provide you with this.
