Holiday homes

Produced by Tolley in association with Philip Rutherford
Holiday homes

The following Employment Tax guidance note Produced by Tolley in association with Philip Rutherford provides comprehensive and up to date tax information covering:

  • Holiday homes
  • Introduction
  • Holiday homes
  • Meaning of provided
  • The charge to tax
  • Exemption for certain overseas holiday homes
  • Reporting requirements


This guidance note covers both UK holiday homes and those abroad. You should also be familiar with the concepts of the charge to tax arising on the provision of accommodation generally and the calculation methodology for determining the taxable value which are outlined in the Living accommodation guidance note.

For the provision of holidays please refer to the Holidays ― provided or paid for guidance note.

As with any accommodation, the provision of holiday homes may result in a tax charge on the employee to whom the holiday home is provided.

Meaning of provided

Unlike with day-to-day accommodation, the meaning of ‘provided’ in ITEPA 2003, s 102 requires little consideration because it is clear for how long the accommodation is provided to the employee; the term requires more consideration in relation to holiday homes.

The reason this becomes more relevant is that HMRC may seek to tax an individual on the basis of when the property is available for use. There are two key questions:

  1. who can use the accommodation?

  2. why was the accommodation bought or rented?

For example, a company buys a flat and an employee lives in it throughout the year. It is clear in this case that an annual tax charge applies.

Contrast this with a company that buys a holiday home in

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