New holiday let rules brought in by the Welsh government could cost business owners thousands of pounds.
Officials have introduced new regulations in a bid to balance increasing tourism numbers and protecting local communities.
They include changes to how council tax applies to holiday rentals. From 2023, holiday lets must be rented out for at least 182 days in the previous 12 months, and be available to let for at least 252 days of the same period to be considered for business rates instead of council tax.
The owner must also intend to make the property available to let out for at least 252 days in the following 12 months too.
Lets that aren’t rented out for the minimum requirement are instead changed to council tax charges. The change was introduced to help tackle second-home owners who were dodging council tax premiums.
But, it has caused problems for genuine holiday home owners who have been hit with huge, unexpected bills.
One host, Clive Mortlock, received a whopping £27,000 council tax bill, The Times reports.
The 77–year–old has two holiday cottages in Henllan Amgoed which he has rented out since 2002.
New holiday let rules in Wales have caused issues for owners who aren’t meeting the 182-day threshold. Pictured: Saundersfoot, Pembrokeshire, South Wales
He has never been required to pay council tax on them before the change or business rates due to their rateable value.
Last month, he was sent a bill backdated to 2023 that also included a 100 per cent second home premium that Carmarthenshire council charges.
‘It would effectively wipe out any profit I have made in the last three years. Adopting this blanket approach is ridiculous,’ Mortlock told the publication.
‘My business faces collapse – not because it isn’t trading effectively, but because of unrealistic Welsh government legislation.’
The council tax premium on second homes and holiday lets that don’t meet the criteria has been introduced to try and reduce the number of empty properties.
It outlines how local authorities can charge their own rate which can be up to 300 per cent on top of the standard council tax.
Mortlock isn’t alone, Nicky Williamson from the Professional Association of Self-Caterers (PASC) revealed: ‘Every day we are dealing with people receiving backdated bills. The highest one I’ve dealt with was £60,000.’
In an attempt to fill up rooms and meet the requirements, Williamson says many are reducing their prices.
One host, Clive Mortlock, received a whopping £27,000 council tax bill. Pictured: Brightly coloured holiday homes in Criccieth, Gwynedd, Wales
In an attempt to fill up rooms and meet the requirements, many are reducing their prices. Pictured: Llandudno in North Wales
Gyles Palmer is another holiday home owner struggling with the new rules.
Over the past 20 years of being in the business, Palmer has not managed to book more than 150 nights per property and now he has been hit with a £15,000 council tax bill.
He claims to make only around £10,000 profit each year from his business and finds the 182 rule difficult to attain.
Powys council told The Times it was required to enforce the 182-day rule by the government but acknowledged concerns.
It has also said it plans to offer discounts for holiday lets who are struggling with the new council tax.
Carmarthenshire council said it was following instructions from the Valuation Office Agency and would be supporting those finding the rules difficult.
The Welsh Government told the Daily Mail: ‘We will keep the 182-day threshold for holiday accommodation under review and create clear and reasonable new exemptions where that accommodation would not qualify as a private home.
‘This new Welsh Government is committed to getting the balance right – keeping homes in our communities while giving tourism the support it needs to thrive.’
The number of holiday homes in Wales soared between 2020 to 2023, from 2,090 to 2,760 in Gwynedd alone, WalesOnline reports. Anglesey saw an increase from 855 to 1,132 and Conwy rose from 660 to 844.
But since the new regulations have come into play, PASC noted a 26 per cent decrease in short-term rentals between 2024 and 2025.
The Daily Mail approached Plaid Cymru for comment.
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