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Council Tax Holiday Lets

Ask the Experts: I currently pay council tax on my holiday cottage. Is this right?

Ask the Experts…

Q. I currently pay council tax on my holiday cottage. Is this right?

A. The Helpful Holidays team say:

Paying council tax on your holiday cottage is correct if it’s just your second home and not rented out commercially. If you make it available for holiday lets for 20 weeks (140 days) or more, then it should be registered for Business Rate property tax rather than council tax. This also includes Furnished Holiday Lets (FHL). The Valuations Office sets the rateable value and business rates are charged accordingly.

However, this may not be bad news as you may be entitled to claim Small Business Rate Relief – dependent on your local area. Currently, if the rateable value of a property is less than £15,000, small business rate relief can be up to 100% for many councils.  So it may benefit you to register the holiday cottage for business rates.

Similarly, Furnished Holiday Letting (FHL) tax relief is available on aspects for properties made available for 30 weeks and let for at least 15 of them. Basic guidance from HM Revenue and Customs on Furnished Holiday Lets can be found on the Direct Gov website.

For more information on holiday letting, visit the Helpful Holidays Let Your Cottage Page and call the number on screen, or fill in your details to receive our information pack.