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Business rates loophole for holiday lets

I found myself unwittingly quoted in Cornwall Live!

This issue of the business rates loophole has been brought to the fore again by the Government’s decision to allow authorities to charge double council tax on empty second homes.

Currently, still, if a residential property is available for let for 140 days per year (next year to be actually let for 10 weeks per year) then the owners can register for business rates, rather than pay council tax. If the rateable value of the property is less than £15,000, then they are exempt from business rates and so pay no tax or rates at all to the local authority.

The government does pay a top up to the council to take account of this, but of course taxpayers are still ultimately funding this exemption.

Some suggestions to close the loophole properly are that residential properties should solely pay council tax & not be able to register for business rates. Or alternatively, that the rateable value exemption should be removed for business rates in this specific circumstance, so that they are payable for all holiday lets.

In Cornwall, business rates are currently retained by Cornwall Council rather than passported to government.

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