3494 new to holiday letting - what to do?

Hi All,

I've bought and am in the process of modernising a property which I shortly hope to have available for holiday lets (which I hope to use to offset some of the mortgage payments, at least for now, rather than as a profit making scheme). But I have no experience of doing this. I'm sure I could find an agent who would manage it for me, but I'd like to learn as much as possible for myself first. So I have a whole series of questions! (my italian is reasonable, I don't mind if the best references are in italian)

1. I don't know the tax rules; in particular, whether taking payments in the UK or Italy makes a difference as to which country I would pay tax in. Where is a good starting point for finding how this works?

2. I'd like to be able to take payments in either euros or sterling. Is that practical?

3. I've seen some people talking about getting house/contents insurance through a UK company rather than an Italian one. What are the advantages of that?

4. What legal responsibilities do you have as owner of a holiday let in Italy?

5. If I pay someone to help with the house (cleaning, laundry, etc) on an occasional basis is this a simple cash transaction or are there tax/legal implications?

6. What else should I be thinking about that I haven't realised?

Thanks for all and any advice!

Graham

Category
Property Sales/Rental Advice

Submitted by Anonymous (not verified) on Wed, 05/03/2006 - 10:23

There was a thread started by Sano recently which went into a lot of the pros and cons which it would be worth you checking out. Agree its worth asking the laymyhat board and also check out holiday-rentals.com and owners direct to see what kind of competition you have in your area, prices you can charge for places with and without pools etc. Where is your place?
Most essential thing is having someone really reliable nearby who can handle changeovers and any problems that may arise if you are not in loco.
And don't be surprised when people ask for the oddest things!

Marina

Submitted by Anonymous (not verified) on Wed, 05/03/2006 - 11:18

Thanks,

I can't find the 'thread started by Sano'; any hints?

laymyhat.com looks good - it didn't turn up for me from google. There's some relevant discussion on there - though some of it just points back to here! ( [url]http://www.laymyhat.com/forum/viewtopic.php?t=898[/url])

The main financial/legal suggestions I've found so far (not entirely consistent) are:

1. Make sure the house is licensed with the comune
2. Don't tell anyone, including the comune ;-)
3. Keep receipts for building work and fittings to offset against tax on the rental
4. Speak to a ragioniere
5. Speak to a commercialista
6. Get a partita IVA (really? Is there no minimum limit on income in a year before you pay IVA, as in the UK?)
7. Arrange for all visitors passport numbers to be given to the local carabiniere

Still looking...

Cheers
Graham
PS. Marinaw: it's a small place in Penne, Pescara (Abruzzo)

Submitted by Anonymous (not verified) on Wed, 05/03/2006 - 11:32

Sorry maybe the sano thread has gone because he left (but I think is back) it had a title which included renting I think.

M

Submitted by Anonymous (not verified) on Wed, 05/03/2006 - 11:46

[url]http://www.italymag.co.uk/forums/general-chat-about-italy-italy-magazine-forums/3321-what-has-better-rental-potential.html[/url]

Found it in the General section... :)

Submitted by Anonymous (not verified) on Sat, 05/06/2006 - 05:05

Holiday lets can either work beautifully and provide a solid income or be extremely hard work for very little return!

On the tax front one thing to remember if you are paying your tax in the Uk is that you can only offset repairs and maintenance. Any improvements become captial allowances so if you decide to change what is a perfectly functionable bathroom for an all singing all dancing one you can only offset a percentage (25%) each year. You can claim 10% deprciation annually on furnishings.

If you have a UK property that you will be renting out whilst you try La Dolce Vita you will also need to register as a non resident landlord. Otherwise your tenant or letting agent will have to deduct tax at source (22%) and pay it to the Inland Revenue.

Jackie

Submitted by Anonymous (not verified) on Sat, 05/13/2006 - 14:51

Marinheiro

I have left you a private message.

Cheers

Chico