Wales holiday let tax rules could be refined under proposals
The Welsh Government has launched a consultation on proposed changes to the way tax rules apply to self-catering holiday lets.
Since April 2023, holiday lets must be available for 252 days and actually let for 182 days each year to be classed as non-domestic and pay business rates instead of council tax. The rules were introduced to ensure owners make a fair contribution to local communities and services.
The consultation seeks views on three possible refinements:
Allowing owners to use an average of 182 days let across two or three years, rather than meeting the target each year.
Counting up to 14 days of free accommodation donated to charity towards the 182-day threshold.
Asking whether councils should consider giving owners a 12-month grace period before higher council tax applies when properties move from business to domestic classification.
The Welsh Government said 60 per cent of self-catering properties have met the new letting requirements since the rules came into force.
Cabinet Secretary for Finance and Welsh Language, Mark Drakeford, said:
“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.”
Any changes would require legislation, with new rules expected to take effect from April 2026.
The consultation is open until 20 November 2025 and is available at: Proposed refinements to the classification of self-catering properties for local tax purposes | GOV.WALES
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