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Publication - Impact assessment

Non-domestic rates/Council Tax second and empty homes consultation: business and regulatory impact assessment

Published
17 April 2023
Directorate
Local Government and Housing Directorate
Topic
Business, industry and innovation, Communities and third sector, Economy, +3 more … Farming and rural, Housing, Money and tax
ISBN
9781805257103

Business and regulatory impact assessment (BRIA) relating to the consultation on council tax for second and empty homes, and thresholds for non-domestic rates.

View supporting documents Supporting documents

Annex B

Table 10: Summary of the current legislative framework for Second and Long-term Empty Homes, and Self-catering accommodation
Second Homes Empty Homes Self-catering accommodation
Local Property Tax Council Tax Council Tax Non-Domestic Rates
Definition A "second home" is a dwelling which is no one's sole or main residence and is lived in for at least 25 days during the 12 month period of council tax. An "unoccupied dwelling" is a dwelling which is no one's sole or main residence, but which is not a second home.

To be classed as self-catering holiday accommodation, a premises must:

  • Not be the sole or main residence of any person
  • Actually let for 70 days in the same financial year
  • Available to let, or actually let, for 140 days (note, this also includes the counting of the minimum 70 days of actual letting)
Default

50% discount must be applied on:

  • Job-related dwellings
  • Purpose built holiday homes

50% discount must be applied on:

  • Homes that have been empty for less than 6 months since the person liable for council tax purchased it and are undergoing major repair/structural alteration

Up to 100% Small Business Bonus Scheme. From 1 April 2023:

  • 100% relief will be available for properties with a rateable value of up to £12,000
  • properties with a rateable value between £12,001 and £20,000 relief will taper to 0%. The cumulative threshold for multiple properties cannot exceed £35,000.
Local discretionary powers

Councils can make modifications to the 50% discount default to:

  • Set a discount between 10-50%
  • Charge the full rate of council tax

Councils can make modifications to the 50% discount default to:

  • Set a discount between 10-50%
  • Charge the full rate of council tax or charge a premium of up to 100% on homes empty for 12 months+
 Councils have discretion, in exceptional circumstances, to determine that self-catering holiday accommodation that fail to meet the 70 days actual letting, can continue to be classed as self-catering accommodation.
Exemptions   Homes that have been empty for less than 24 months and are actively marketed for sale or let are exempt from the premium. Note a premises may be unoccupied but exempt from Council Tax for another reason – e.g. the owner is deceased.  

Contact

Email: secondandemptyhomes@gov.scot

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