Consultation launched on holiday let tax rules
Consultation launched on holiday let tax rules
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The Welsh Government has launched a consultation on proposed changes to tax rules for self-catering holiday lets, aimed at giving property owners more flexibility while ensuring they contribute fairly to local communities.
Since April 2023, self-catering properties in Wales must be available for at least 252 days a year and actually let for 182 days to qualify for non-domestic rates rather than council tax. The rules were introduced to address concerns that second homes and holiday lets were reducing the supply of housing for local residents while not contributing adequately to public services.
Under the new proposals, the government is seeking views on two possible adjustments:
- Allowing owners to use an average of 182 letting days over two or three years, meaning those who narrowly miss the threshold in one year could still qualify for non-domestic rates.
- Allowing up to 14 days of free holidays donated to charity to count towards the 182-day requirement.
The consultation also explores whether councils should have the option to give businesses more time to adjust to the rules, such as a 12-month grace period before they move from non-domestic to domestic classification and face higher council tax rates.
Cabinet Secretary for Finance and Welsh Language, Mark Drakeford, said the aim was to balance the needs of communities with the interests of the tourism sector.
“Tourism makes an important contribution to the Welsh economy and to Welsh life. Wales has so much to offer, and we want to ensure we realise that potential in a way that achieves a balance between our communities, businesses, landscapes and visitors.
“We work closely with tourism and hospitality businesses to help address the challenges they face, while ensuring everyone makes a fair contribution towards local economies and funding public services.
“While most holiday let owners are already meeting the new rules brought in from 2023, with 60% of properties meeting the letting criteria, we have listened to those working in the sector and are proposing small changes to the current rules to support them.”
The consultation will run until 20 November 2025, with responses invited from holiday let owners, local authorities, tourism operators, and community groups.
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