United Kingdom

Holiday let loophole to close

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Holiday let owners could soon face bigger tax bills after the government pledged to close a council tax loophole.

Currently, second home owners need merely declare their intention to let their properties to holidaymakers to pay business rates instead of council tax, saving them hundreds of pounds each year. From April 2023, though, only homes that are in fact being rented out will qualify.

The move is aimed at preventing second home owners from falsely registering their country retreats as businesses, and is unlikely to affect genuine holiday let landlords. Holiday let owners will have to show that the property is available to rent for at least 140 days a year and is in fact let for at least 70 – a fairly low bar for properties in popular tourist areas. 

Critics of short-term lets are unlikely to be satisfied, though. The Campaign to Protect Rural England has already said that the new rules don’t go far enough to rein in a growing housing crisis in rural communities. Cracking down on tax-avoiding second home owners might make it less attractive to keep an empty holiday home, but the housing shortages are also being driven by a boom in genuine holiday lets rented out on platforms like Airbnb. 

Local politicians and opposition parties are already calling for much stricter rules on short-term lets. The government is now considering a licensing scheme that would require owners to get permission from local councils before renting out their properties on a short-term basis – a move that would have a much bigger effect on holiday lets.

Other short lets headlines

Holyrood committee votes for short-term lets licensing – Scottish Housing News

Tax increase considered for second homes in Wales – Wales Online

Host lists back garden tents as “tropical” place to stay – Birmingham Mail

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