Powys County Council has approved new measures to support owners of self-catering holiday accommodation in the county who have been transferred from business rates to council tax following changes to national eligibility criteria.
The authority's Full Council has approved a new discretionary council tax discount classification for eligible self-catering properties that have moved from the business rates list to the council tax list. The discount will remove the additional 75% premium charge for the backdated period, with effect from 1 April 2023.
The council also approved that the estimated £1 million cost of implementing the discount will be met from an existing £1.2 million provision that had been set aside to cover the risk of non-collection of income from these properties.
The decision follows changes introduced by the Welsh Government in April 2023, which increased the criteria that self-catering properties must meet to remain on the business rates list. As a result, around 250 properties in Powys have transferred to the council tax list, with some receiving significant backdated bills.
The new discount aims to provide proportionate support to affected businesses while maintaining liability for the standard council tax charge, the council said. It added that the measure will help reduce financial hardship, support the local tourism economy and improve engagement with affected ratepayers.
Councillor David Thomas, Cabinet Member for Finance and Corporate Transformation, said:
“This decision provides fair and practical support for self-catering business owners who have been affected by changes to national regulations. While property owners will remain responsible for paying the standard council tax due, the removal of the backdated premium charge will help ease financial pressure and give businesses greater certainty as they adapt to the new arrangements.
“Supporting local businesses and maintaining a thriving tourism economy is an important part of building a Stronger, Fairer and Greener Powys for our communities and future generations.”
The Professional Association of Self-Caterers (PASC UK) Cymru, the trade body for the short-term holiday let sector, welcomed the decision.
PASC UK Cymru’s Nicky Williamson said:
“We are relieved by the decision made by Powys County Council. They have looked honestly at the impact of this policy, both on the businesses affected and on its own recovery teams, and made the sensible decision. Thousands of small, often family-run self-catering businesses in rural Wales have been pushed into arrears and enforcement action for missing a target that was never realistic in a seasonal market. This decision won't undo the stress and cost already incurred, but it will provide meaningful relief to operators who did nothing wrong beyond running a business in a place where demand simply isn't there for 182 days of the year.
“We now call on every other Welsh local authority to follow Powys' lead. This shouldn't be a postcode lottery. The Welsh Government should also look again at the 182-day rule itself, which remains far higher than the 70-day threshold used in England and Scotland.”
There is no requirement for owners that qualify for the discretionary discount to apply. The council said it was aware of the properties impacted and will automatically award the discount and issue a revised council tax bill in the coming weeks.
