Britons with holiday homes in Devon or the Lake District face a setback as the government will no longer extend tax relief for loss-making holiday homes in the UK from April 6 2010.

The change in the HM Revenue and Customs (HMRC) tax treatment offers a limited opportunity for those with unprofitable holiday homes elsewhere in Europe, however. During the 2009-2010 tax year, owners of loss-making holiday homes in Spain or Portugal will now be able to offset losses for these properties against income earned. But they will forfeit this one-time privilege next April, along with UK holiday homeowners, when the government bans the practice. "It's a one-year opportunity to claim losses against other income," explained Paula Higgleton, a partner with Deloitte. Ellen Kelleher