Village News

Christmas Lights

210324 | Three years later: government promises to act on second homes tax loophole

Three years later: government promises to act on second homes tax loophole

Posted By Julia Penhaligon on 24th March 2021

By Julia Penhaligon

The government has said it will close a tax loophole that allows second home owners to dodge council tax by claiming the properties are available for holiday lets.

There are thought to be nearly 7,000 second homes in Cornwall which take advantage of the loophole by registering as a small business.

In the vast majority of cases the owners of these properties currently pay nothing at all.

The issue has been highlighted by Opposition parties in Cornwall for several years, and last year Cornwall’s Conservatives also joined the call after the government showered millions of pounds in “Covid cash” on second home owners.

The government has been consulting on the tax loophole since 2018, when current chancellor Rishi Sunak was a junior housing minister.

The Treasury yesterday (Tuesday) said it would "ensure that owners of properties that are not genuine businesses are not able to reduce their tax liability by declaring that a property is available for let but make little or no realistic effort to actually let it out".

The holiday lets’ move relates to properties in England which the owner declares are intended to be made available to let 140 days in the coming year, making them liable for business rates rather than council tax.

In 96% of cases, they have such a low rateable value that they qualify for small business rates relief which means they pay nothing at all.

There is currently no requirement for checks to verify that the properties are actually commercially rented out, but some councils are more proactive than others. Cornwall Council's Liberal Democrat-Independent administration has claimed it was powerless to act.

Right - In February 2018 a protest march organised by Labour councillor Cornelius Olivier made its point in Mousehole, a hot-spot of second home ownership where local families struggle to find somewhere to live

Right - In February 2018 a protest march organised by Labour councillor Cornelius Olivier made its point in Mousehole, a hot-spot of second home ownership where local families struggle to find somewhere to live

Right - In February 2018 a protest march organised by Labour councillor Cornelius Olivier made its point in Mousehole, a hot-spot of second home ownership where local families struggle to find somewhere to live

This article has 1 comment

John Wombwell

Morning Graham.
I have mentioned this before on how it works in Spain.
Forget the business rate keep it as normal rates but.
1/ They have to apply for a tourist license
2/ They have to get Liability insurance to protect the rental clients
3/ They have to declare the income on a quarterly basis and pay the tax on the income.
4/ They have to supply the names of all guests over the age of 16
5/ If they don’t abide they are fined up to 20,000 euros
And the Brits that have holiday homes abide by these rules and if they don’t they loose the license and fined.

 

 

 

Via Cornwall Reports

No pop-ups, no click-bait, just quality independent journalism with no adverts on news pages

Subscribe to http://cornwallreports.co.uk for less than 9 pence/day, or pay-as-you-go for only 20 pence/article. Journalism has value. #CornwallReports

Book page

TitleCreated
240325 | Open letter to all party candidates | sign to help Cornwall Wildlife Trust make difference for Nature at election 22 hours 15 min agoBook page
240310 | Detailed plans for affordable-led housing in Connor Downs 10th March 2 weeks 3 days agoBook page
240310 | Waste collections changes Helston, Penzance, Hayle | second phase:food waste, recycling, rubbish - commences July 2 weeks 3 days agoBook page
240218 | Collapsed North Quay development in Hayle described as a 'sea of despair' 5 weeks 16 hours agoBook page
240214 | Hayle North Quay development collapse sees eight companies go bust Work has ground to a halt on the blocks of flats 5 weeks 3 days agoBook page
240220 | Poling works | Grist Lane and Marsh Lane, Angarrack | expected 20 Feb 2024 0830-1630, for one day 7 weeks 2 days agoBook page
231130 | Are you ready for weekly food waste recycling? | Food Waste, Recycling and Rubbish Collection Changes 16 weeks 3 hours agoBook page
230821 | People of Cornwall town 'thrown under bus' over housing plan | direct result of councillors handled Hayle masterplan 31 weeks 1 day agoBook page
230817 | When will new rubbish collection changes start, Cornwall 31 weeks 6 days agoBook page
230809 | Holiday park in Cornwall for emergency housing still empty | Sandbank site purchased Cornwall Council in Jan 2022 32 weeks 5 days agoBook page
230811 | Decision on huge solar farm at Carnhell Green: refused 32 weeks 5 days agoBook page
230809 | Nearest NHS dental practice to Cornwall taking new patients 32 weeks 5 days agoBook page