THERE is more than one kind of holiday romance. Many people who would never contemplate a fling with a cute stranger can develop a different sort of crush. In this case, the love object is a hot property abroad that suddenly seems to be the ideal place to spend summers ever after. But the often troubled consequences of such attachments show that the British remain woefully unaware of Customs & Revenue’s interest in foreign affairs: the third person in a relationship with your home abroad will be the UK taxman – or his overseas counterpart.

Among those who have experienced the sometimes bizarre repercussions of this intrusion are those who were forced by local regulations that apply in Bulgaria and elsewhere to buy properties through companies. Until a change in the Budget, they found their use of their home taxed as a benefit in kind, or perk, in the same way as a company car.

Such episodes indicate that it is essential to follow some dating rules before making a long-term commitment to a holiday home. Leonie Kerswill, tax partner at PricewaterhouseCoopers, suggests that you approach the purchase in the knowledge that there are likely be local taxes at the outset, further community and other charges thereafter and that local legislation could constrain your ability to pass on the property to your heirs and dependants.

The Revenue, which is currently on a mission to hunt down unreported overseas income, will expect income tax on rental revenue. As Ms Kerswill points out, “tax authorities now share information on property acquisitions and tax paid”. This scrutiny will extend to any profits made from restoring and then selling a picturesque wreck. If such developments become a serial activity, then they will be considered to be trading businesses and taxed accordingly.