Inheritance Tax relief update for holiday parks

Category: Leisure - Posted On: Jan 8 2019

Business property relief (BPR) can reduce the taxable value of relevant trading business property by up to 100% when sold or transferred on death. Caselaw has played a significant role in determining when BPR has been allowable, often ruling in favour of HMRC. Recent caselaw has seen the courts ask  – is the business, wholly or mainly of holding investments?

In the Ross case (Executors of Marjorie Ross v HMRC) heard in June 2017, the deceased owned 8 holiday cottages together with 3 other property lets.  The holiday lets had an agreement with the hotel situated opposite, providing services to the cottage guests as though they were guests of the hotel.  However HMRC argued that these services were not enough to qualify it as a trading business and BPR was disallowed.

Holiday Park businesses have many challenges identifying if they will be eligible for BPR. Park owners must be able to demonstrate that the proportion of their business relating to the letting of land is secondary to other services and facilities provided.  Due to the wide range of park sizes and facilities there is no defining rules to ensure that a business will definitely qualify for BPR.

For further information please follow links to our additional BPR factsheets:
What is Business Property Relief?
BPR Caselaw Summaries

If you’re looking for more information or advice, please contact our EQ Leisure team via or contact one of our offices.