Assuming that you rent the property for 70 days or more, and it is available to be let for 140 days in any one tax year, it will be taxed as a furnished holiday let in the 2009/10 tax year. This has favourable tax treatment for income tax purposes if you make a loss. It can also be beneficial when the property is sold, however this relief will no longer available from 6 April 2010 due to a recent change in the law.
Landlords often forget that holiday accommodation is standard rated for VAT. Even with the total rents of £7,000 being well below the VAT threshold, as you are the sole owner of the property you will need to charge VAT on the rents, as you also operate another VAT registered business.
One way to avoid having to charge VAT this year is to purchase the accommodation as a joint venture with your wife. This would have the benefit of utilising some of your wife's personal allowance for the year. Assuming that you do not operate another VAT registered partnership with your wife, it would also negate the need to charge VAT on the rents as the letting would be treated as a separate entity for the purposes of VAT registration.