Furnished Holiday Lets: Rates loophole to close
12th January 2022
From April 2023, the government will be tightening up the rules in England where currently some landlords do not pay either business rates or council tax on their furnished holiday lets. In most cases, however, landlords will want to be assessed for business rates in the hope of qualifying for small business rates relief (SBRR), and as a result, still pay no business rates at all.
Landlords will need to provide evidence that a property:
- Will be available for short term commercial lets for at least 140 days in the next year
- Was available for short term commercial lets for at least 140 days in the prior year
- Was actually let commercially for short periods of at least 70 days in the prior year
Newly available holiday lets will be liable to council tax until they meet the above criteria, so a minimum of 140 days. This represents a tax increase for newly let properties.
We are already seeing cases where the Valuation Office has written to clients requesting a large volume of information to begin making their assessments.
Disclaimer - All information in this post was correct at time of writing.
