As a second-home owner in Cornwall, it’s important to understand the upcoming changes to Council Tax premiums. Here’s a breakdown of what you need to know:
New Council Tax Premium:
- Effective from April 1, 2025, Cornwall Council will introduce a 100% Council Tax premium on second homes.1 This means you will pay double the standard Council Tax rate.
- This change is enabled by the Levelling Up and Regeneration Act, which gives local authorities the discretion to charge this premium.2
- The aim is to encourage fairer housing opportunities for local communities by making better use of available housing.
- A second home is defined as a furnished property that you own or rent but is not used as your main residence.3
Exemptions to the Second Homes Premium:
Certain types of properties will be exempt from this premium. These include:
- Annexes that are part of the main home.
- Job-related accommodation where the property is linked to your employment.4
- Occupied caravan pitches and boat moorings.
- Seasonal homes where local regulations prohibit year-round or permanent occupancy.5 This often includes properties specified for holiday use only or with planning conditions preventing continuous occupancy for more than 28 days in a year.6
Additionally, 12-month exemptions may apply in specific cases:
- Properties with restricted occupancy conditions under the Town and Country Planning Act 1990.7 This includes restrictions preventing continuous occupancy for 28 days or more within a year and designation as holiday-use-only or non-primary residence.8
- Properties actively marketed for sale or let at a fair market rate.9 This exemption has a 12-month limit and may have conditions regarding continuous letting periods if the property is re-marketed after a let.10
- Properties that have recently gone through the grant of probate or letters of administration.11 This 12-month exception begins from the date probate is granted.
It is crucial to notify Cornwall Council if your property’s circumstances have changed, for example, if it has become your main residence or is now permanently occupied. The council is currently reviewing properties classified as second homes.12
Converting a Holiday Let to Business Rates:
If you rent out your property as a holiday let, you may be subject to Business Rates instead of Council Tax. The Valuation Office Agency (VOA) determines this, not the local council.13 To qualify for Business Rates, your holiday let must meet the following criteria:
- It has been available to let commercially for short periods for at least 140 nights in the past 12 months and will continue to be available for at least 140 nights in the coming year.14
- It has been commercially let as self-catering accommodation for short periods for a minimum of 70 nights in the past 12 months.15
New holiday lets will initially be subject to Council Tax for at least the first 140 days.16 Once the criteria for Business Rates are met, you can request the VOA to reclassify your property. The decision to reclassify lies solely with the VOA.
Preparing for 2025:
These changes will significantly impact the property expenses for second-home owners in Cornwall. It is recommended that you:
- Review the definition of a second home and the exemption criteria carefully to determine if the premium applies to your property.
- Gather any necessary documentation if you believe your property qualifies for an exemption (e.g., marketing details, planning restrictions, probate documents).
- If you operate a holiday let, track the availability and actual letting periods to assess if you meet the criteria for Business Rates.
- Contact Cornwall Council if you have any questions about the new premium or need to update the status of your property.
Understanding these regulations will help you prepare for the changes taking effect in April 2025 and ensure you comply with local requirements. Contact us hello@seacrhhomes.co.uk
