Wales Proposes Tax Changes for Self-Catering Holiday Lets

The Welsh Government is proposing key reforms to the tax rules governing self-catering holiday lets to support the tourism sector and provide relief to property owners. Since April 2023, properties must be available for 252 days and let for 182 days annually to qualify for non-domestic business rates instead of higher council tax, but this has faced criticism for being too rigid and penalizing some owners. The proposed changes include averaging the 182-day letting requirement over multiple years and allowing up to 14 days of free accommodation donated to charity to count toward this threshold. Additionally, the government is consulting on whether councils should offer a 12-month grace period before imposing higher council tax when classification changes from business to domestic. These changes aim to address seasonal fluctuations and booking unpredictability, easing the financial burden on owners while maintaining fair contributions to local services. The consultation on these proposals is open until November 20, 2025, with any new legislation expected to take effect from April 2026.