Second Home Council Tax 2026 - Premiums and Exceptions
The council tax rules for second homes changed substantially from April 2025. English councils can now charge a 100% premium on second homes. Welsh councils have been able to charge premiums for longer and can charge up to 300%. Scotland can also charge up to 100%. This page explains the current rules, the exceptions, and the legitimate ways to reduce or avoid the premium.
Second Home Premiums by Nation 2026/27
England
100% premium
Up to 200% of Band D
In force since: April 2025
Each English council decides whether to apply the premium and at what level. Not all councils have adopted it.
Wales
300% premium
Up to 400% of Band D
In force since: 2023 (phased in)
Welsh councils have had the power to apply premiums since 2017; the maximum was raised to 300% for long-term empty and second homes from 2023.
Scotland
100% premium
Up to 200% of Band D
In force since: 2019
Scottish councils can charge up to 100% premium on second homes. Not all councils apply the maximum.
What Counts as a Second Home?
For council tax purposes, a second home is a dwelling that is:
- •Substantially furnished (not empty - empty furnished properties are the primary target)
- •Not the owner's or occupant's sole or main residence
- •Not a primary residence of any occupant
A furnished holiday let that is occupied by paying guests for significant periods is not a second home for council tax purposes - it may qualify for business rates instead (the 'holiday let' route). This is a meaningful distinction that can result in significant tax savings if the property qualifies.
Exceptions and Exemptions
Job-related dwellings
If you are required to occupy a property for the purpose of your job and you have a main residence elsewhere, the job-related dwelling may be exempt from the second home premium. This applies to a limited range of roles where occupancy is a contractual requirement.
Annexes to the main dwelling
An annexe that is part of a larger property occupied as the main home may qualify for a 50% discount rather than the full second home rate, provided it is occupied by a relative of the main householder.
Holiday lets under business rates
If you let your property as a holiday let for more than 70 days per year (and it is available for letting for at least 140 days), it may qualify for small business rates relief rather than council tax. This can eliminate the council tax liability entirely if the property qualifies for 100% small business rates relief.
Agricultural properties and tied cottages
Some agricultural tied cottages and estate properties have specific exemptions. Seek specialist advice if your property has an agricultural connection.
How to Legitimately Reduce or Avoid the Premium
- 1.Make it your main residence: the most straightforward route, if your circumstances allow.
- 2.Convert to a qualifying holiday let: if you can demonstrate the required letting activity (70 days actual letting, 140 days available), you switch to business rates and may qualify for 100% small business rates relief.
- 3.Long-term rental: letting the property to a tenant on a residential tenancy means it becomes their primary residence, removing it from the second home premium category.
- 4.Sell: if the premium makes the property financially unviable, disposal is always an option.
Affiliate disclosure: we may link to mortgage or conveyancing services relevant to property decisions. We disclose any commercial relationship.
Updated April 2026. Second home premium rules under the Levelling-Up and Regeneration Act 2023 (England), Housing (Wales) Act 2014, and Local Government Finance (Scotland) Act 2016.