Holiday Let & 2nd Home Tax Hikes by April 2023

Holiday homes

Wales increases tax on 2nd homes & holiday lets 

Welsh Government has just agreed to an increase to council tax premiums for second homes and new local tax rules for holiday lets that protect the local economy, impacting many second home owners and holiday let businesses in Wales. These changes, designed to help local people buy in their communities as house prices spiral, are partly driven in rural and coastal areas by the pressure from second home and holiday let buyers.

Council Tax Premiums

Welsh Local Authorities will be allowed to set council tax premiums on second homes and long-term empty properties to 300% as of April 2023. Councils will be permitted to set the premium at any level up to the maximum as they see fit on second homes and long-term empty abodes. Premiums currently at 100% threshold hit 20,000+ Welsh properties this last year.

Self-Catering Rule Changes

Rules for what constitutes self-catering accommodation (liable for business rates) are also set to change in April 2023. Currently, properties available to let for 140+ days, that are actually let for 70 +days will be set to pay rates and not council tax.

This change will increase these thresholds to ‘being available to let for at least 252 days’ and ‘actually let for at least 182 days’ in any 12-month period. The change will provide a clearer demonstration that properties are being let regularly as genuine holiday accommodation, contributing to the local economy.

The Welsh Government has also announced further funding for affordable homes in Wales.

Let’s Talk

For help with your property tax or if you are affected by these new approaching rules, get in touch with our team of tax specialists on Let’s Talk.

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