Inactive Holiday Lets to Lose Tax Relief

Published / Last Updated on 26/03/2021

Following a consultation by the Ministry of Housing, Communities and Local Government (MHCLG) on business rate treatment of self-catering accommodation, which ran from November 2018 to January 2019, the Government now plans to prevent owners of properties that are not trying to let their property from claiming small business rate tax relief.

Holiday let owners must make their properties available to let for 140 days in the coming year, although no checks are made on the owner to whether they are actively trying to let their property.

96% of over 60,000 holiday lets on the business rates list have a smaller rateable value and likely to qualify for Small Business Rates Relief which means they have no business rates to pay at all.

The holiday let market has generated a lot of interest since the start of the pandemic.  Demand has forced mortgage brokers to call for lenders to launch new holiday let mortgage products due to both work/life changes and also current restrictions for holidays abroad.

The announcement on 23rd March 2021 (Tax Day) is part of a 10-year plan to modernise the tax system outlined by the government in July 2020.


We have always felt in unfair that a buy to let investor must pay council taxes on property when vacant but the property next door, a holiday let can claim to be a 'business' to benefit from small business rates relief i.e. no taxes with no real proof required that the property has been let or is available to let.

Explore our Site

Money MOT
T and C