Is renting your house as a holiday let still a viable option? Part 4 - Page 2

It's great to read such a clearly written and comprehensive account of the requirements for obtaining a tourist licence - for too long there has been much misinformation circulating around and a lot of people failing to comply with what are very stringent conditions. As someone contemplating buying another property specifically as a tourist let I really appreciate you sharing your knowledge. It's great to see that you are a responsible property owner - I fear there are still some people who feel they are above law and who openly flout it, neither paying tax on rental income or worrying about letting requirements. 

Thank  you both.

Thanks for your great information...i am currently planning a buy...lanzarote or denia..basically for my own vacation and we plan to retire there in 15 years :-)

currently, i am very unsure if i should invest, as we only have 50 % cash (depends on the price of course) for the project...

The are a lot of hurdles to be taken..currently , it looks like we will buy and only use it for our own purpose, so we will not run into trouble..

by the way..the lanzarote property sands beach is a hotel, but appartements are for sale.. the hotel will rent it out for a small budget, seems like a hasslefree earning, what do you think?

Rules on Lanzarote are very different.  I believe you can can only let through a registered business and the complex itself has to have a license as well.  The information we gave out relates solely to the Valencia region (of which Alicante is a province).  Every region in Spain sets its own licensing rules.  So wherever you decide to buy double check the up-to-date local licensing regulations before committing to the purchase if letting is important to you.

ok, great thanks..well the complex is a hotel "sands Beach" i suppose they have a license :-)

very precious infos which i really appreciate..BUT if i only want it for myself there are not rules to fulfil.correct..

i was surprised, that even family which do not give money for it....need the official license..

If you are using the property for you then it is your own home, whether main residence of just for holidays.  You can allow friends and family to stay at the house for free but you cannot accept any payments from them for the use of your property.    

thanks, got it

Hi. I have been reading your very helpful posts with regards to lettings. I have just bought a holiday home in GA for our use. I note you say if friends or family use it you cannot accept payment for the rental unless you have a licence. Would this also apply to them just covering the cost of the electricity used but taking no other money for the rental? 

as far as i understand it, there should not be any cashflow via accounts..(your relatives do not pay you anything, official) which isn´t as you host them for free, of course you cover all the monthly costs...

Technically if anyone pays you anything for using your otherwise empty your property then they are paying you for the use of that property, it is money they would not have given you unless they were holidaying at the house, so it can be classed as rental, even if  a nominal amount.  That is the official position.  

Bear in mind, also, that if you are taking money for the use of your house, even a nominal amount, then your insurance company could refuse to cover you in the event of you having to make a claim as you need specialist insurance for renting out a property, and the community insurance would also not cover your friends/relatives if technically they are renting an illegal let.  It isn't just about paying tax.

If you have people staying with you in your own home when you are there then they wouldn't be paying to visit you - they are there as your guests, they don't pay for electricity etc.  So, basically people are either guests staying for free or they are paying rent.