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Second Homes and Holiday Lets Council Tax & Business Rates Rules

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The council tax, business rates and licencing rules for second homes and holiday lets are evolving. This is due to the Governments concerns that the rise in second homes and holiday lets in rural communities is leading to a shortage of affordable housing for locals.

We will update this page with the latest changes to the rules.

New licensing laws for short term lets in Scotland

The Scottish government is introducing a licensing scheme for Airbnb owners and short-term holiday let landlords across Scotland. The purpose of the licensing scheme is to ensure short-term lets are safe and address issues faced by neighbours.

Councils will be required to implement a licensing scheme by October 2022. Hosts and operators will need to be fully licensed by 1 April 2024.

The Scottish Government have revealed that there will be a review of licensing in summer 2023, but the precise details of this remain unclear.

Holiday lets register for England

The government is looking to set up a holiday lets register for England, amid concerns that the rise in second homes and holiday lets in rural communities is leading to a shortage of affordable housing for locals.

MPs urged the Government to adopt measures including limiting the number of second homes in communities by changing planning laws and doubling council tax in some of the worst affected areas.

New tax rules for second homes in Wales

The Welsh Government has announced an increase to the maximum level of council tax for second homes, as well as changes to the business rates criteria.

Second home owners face a potential 300% council tax rise

The Welsh government has declared it is increasing the maximum level that local authorities can set council tax on second homes. Currently, the maximum premium councils can charge is 100 per cent – so the new policy constitutes a possible tax rise of 200 per cent.

Business rates criteria changes

The criteria for self-catering holiday lets in Wales qualifying for business rates rather than council tax will also change from next year.

Currently, properties available to let for a minimum of 140 days in any 12-month period, and actually let for at least 70 days, pay business rates rather than council tax. But from April 2023, properties must be available to let for at least 252 days and actually let for at least 182 days in any 12-month period to qualify. If you cannot meet these thresholds, then you will be required to revert to paying Council Tax.

For further information visit the Welsh Government website: https://gov.wales/new-tax-rules-second-homes


  • Vikki |

    The changes to the Welsh legislation are still uncertain, please find the latest information from PASC UK who are acting on behalf of us in Wales to make the government realise the difference between 2nd homes and genuine businesses. Living rurally with few amenities nearby and almost certainly tourist places being shut through some of autumn and all of winter will make it impossible to obtain the full 182 days. Only 16% of businesses think they will be able to make this achievable and many – like us – will have to consider if we can continue where we will be working at a loss making business unviable. We do not have 6 months of seasons in Wales (perhaps in certain places) but not many want to visit in the freezing cold temperatures, the wind and rain (and mud!). Even being with one of the biggest agencies in the country only gave us 160 nights and that was beyond what they thought we might achieve. Just because someone is not physically staying in the cottage does not mean we are not still working – cleaning, maintenance, marketing etc.

    • Philip |

      Hi Vikki, thanks for you input. I agree, the 182 days will be hard to achieve and hopefully it will be reduced. Here is a link to the PASC https://www.pascuk.co.uk/reports/

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