From April next year there are to be new eligibility rules for business rates that apply to self-catering properties in England and Wales – and letters are warned that if they don’t meet the rules their property will become eligible for paying Council Tax.
The rules will be used in assessments from 1 April 2023. The information about lettings during the 2022/23 operating year will be used to determine whether a property is eligible.
If your property is in England, to continue to be eligible for business rates, from 1 April 2023 your property must be:
- available for letting commercially for short periods that total 140 days or more in the previous and current year.
- actually let commercially for 70 days or more in the previous 12 months.
Being commercially let means properties that are let with the intention of making a profit. This usually means the property is let at market rates and actively advertised. For example, using holiday cottage websites, estate agents, and tourist web pages to advertise the property.
Any non-commercial lettings, for example lettings to family and friends for amounts below the market rates, would not count towards commercial lettings.
The new rules apply only to properties classified as self-catering holiday lets by the VOA within the broad use category of short stay accommodation . They don’t apply to other types of accommodation in this category, such as hotels, hostels and guest houses.
There won’t be any exceptions in the application of the new eligibility rules. They will apply equally to all self-catering properties across England and Wales.
New self-catering properties will be liable for Council Tax until the property meets the eligibility rules.
Valuation officers conduct a rolling programme to check that properties listed as self-catering properties in the non-domestic rating list meet the eligibility rules. A valuation officer will ask for this information in the ‘Request for Information’ form, which will be sent to you at a later date. It will consider whether you meet the new rules on your actual lettings for your property in 2022/23.
The rolling programme means we will ask customers to give us information at different times during the 2023/24 operating year. But we will be using a universal date, from which we will assess whether the new eligibility rules have been met, of 01 April 2023.
There are a number of reliefs available to assist businesses, including the Small Business Rates Relief scheme (SBRR). You can find out more about reliefs by contacting your local council.
