penalty

07 Apr 23

The government’s Valuation Office Agency has set out the eligibility rules which now apply to self-catering properties in England and Wales.

Properties and owners who do not meet these rules will be eligible for the – normally higher – council tax.

The new eligibility rules are different depending on whether your property is in England or Wales but what is common to both countries is that these rules apply to residential properties (so not, for example, hotels) and have no exceptions.

The VOA says that 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 nights or more in the previous and current year, and actually let commercially for 70 night or more in the previous 12 months.

If your property is in Wales to continue to be eligible for business rates your property must be available to let commercially for short periods that total 252 nights or more in the previous and current year and actually let commercially for 182 nights or more in the previous 12 months.

The VOA looks at whether the property was occupied immediately before midnight to establish whether a property was let on a certain night. For example, this means that a property let out from Friday evening to Sunday morning would have been let for two nights for the purposes of meeting the self-catering criteria.

A statement from the VOA says: “When we talk about commercially let properties, we mean 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 VOA issues forms called ‘Requests for Information’.

One of them has been designed specifically for self-catering units and holiday cottages. The information provided on this form is used to check that the eligibility rules for self-catering properties are met.

The VOA says it’s important that you return this form in time – you will be liable to a financial penalty otherwise. It’s also important to complete it accurately, as it’s a legal document and there can be serious consequences for including false information, including prosecution.

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