When was is the best way.

The question is about the vacation. Where it was. You can rearrange the sentence to find out which one is better: The vacation was somewhere. "The vacation" can be changed with "it". So it becomes "It was somewhere". And from these grammar rules it's clear that you should use "was" in this case:

"was" is grammatically correct, but it would be more natural to say "Where did you go for your last holiday?", at least from a British perspective.