The key distinction between second home council tax and empty home council tax is the state of the property: a SECOND HOME is a property that is furnished and habitable — it can be used as accommodation immediately — but is not the owner's primary residence. The owner pays council tax on it (in addition to council tax on their main home) with the premium applied by the local council. An EMPTY HOME is a property that is substantially unfurnished and unoccupied — it cannot easily be used as accommodation without first furnishing and equipping it. The empty home premium regime (England: 100% after 1 year; 200% after 5 years; 300% after 10 years of being empty) applies to unfurnished, unoccupied properties.
The distinction matters enormously for landlords. A buy-to-let landlord with a furnished property that is between tenancies (void period) may face the second home premium rather than the empty home exemption or the empty home premium, depending on the property's state of furnishing. A furnished rental property in a void period is more likely to be classified as a second home (furnished, habitable) than an empty home (unfurnished, unoccupied). Landlords in Wales are particularly exposed — with premiums of up to 300%, a furnished void rental property in Gwynedd or Pembrokeshire could be subject to up to 400% of the standard council tax rate (100% standard + 300% premium).
Second home council tax premiums by nation, holiday let business rates exemption and distinction from empty homes premium
The complete framework for second home council tax premiums and the key distinctions for landlords:
- England — up to 100% premium from 1 April 2025, Wales — up to 300% from 1 April 2023 and Scotland — up to 100% from 1 April 2024: ENGLAND — second home council tax premium: the Levelling-up and Regeneration Act 2023 (LURAA) Part 5 Chapter 4 amended Local Government Finance Act 1992 s.11B to allow councils to charge up to 100% council tax premium on second homes. In force from 1 April 2025 (but councils must give at least 12 months' notice — so councils that announced premiums from April 2024 can implement them from April 2025 at the earliest). Under the rules: a 'second home' is a dwelling that is furnished and that is not the sole or main residence of any person — councils must be satisfied that the property is NOT a main residence before applying the premium. The 100% premium means the owner pays 200% of the standard council tax rate (standard rate × 2). Implementation is at council discretion — not all English councils have implemented or will implement the premium; councils in areas of high housing pressure and tourism (Cornwall; Devon; Lake District; Yorkshire Dales; North Yorkshire; Cotswolds) are most likely to implement. Exemptions (statutory): councils cannot apply the second home premium to: properties occupied as a job-related dwelling; properties that are the sole or main residence of the owner; properties undergoing major structural repairs for up to 12 months; annexes to a main dwelling that are occupied as additional accommodation for the family; properties used for letting to seasonal workers. WALES — second home council tax premium: from 1 April 2023, Welsh local authorities can charge up to 300% council tax premium on second homes under Local Government Finance Act 1992 s.12A (as substituted by Local Government Finance (Wales) Act 2024, which increased the maximum from the previous 100%). Welsh second home premiums already in effect (illustrative — councils set their own rates and may have changed since): Gwynedd: 150%; Pembrokeshire: 200%; Isle of Anglesey: 150%; Ceredigion: 150%; Gwynedd: increasing to 200% in subsequent years. The Welsh second home premium is the most significant in the UK — a second homeowner in Wales facing a 300% premium pays 400% of the standard council tax rate (standard × 4). Most Welsh councils have now implemented premiums. SCOTLAND — second home council tax premium: from 1 April 2024, Scottish local authorities can charge up to 100% council tax premium on second homes under Local Government Finance Act 1992 s.75B (as amended by Local Government Finance (Amendment) (Scotland) Act 2016, further amended for the 100% maximum). Scottish councils set their own rates — most charge between 50% and 100%. Edinburgh City Council; Highland Council; and Argyll and Bute Council are among the councils that have implemented the maximum 100% premium.
- Holiday let business rates exemption, distinction from empty homes premium and planning for landlords: HOLIDAY LET BUSINESS RATES EXEMPTION — avoiding council tax entirely: properties that qualify as self-catering holiday accommodation for non-domestic rates (business rates) purposes are NOT subject to council tax — they pay business rates instead. This means neither the second home premium nor the empty homes premium applies. Business rates for holiday lets typically attract 100% Small Business Rate Relief (SBRR) if the rateable value is below £15,000 (in England) — meaning many holiday let properties pay zero business rates as well. The qualifying tests differ by nation: ENGLAND: the property must be available for letting for at least 140 days per year AND actually let for at least 70 days per year (Valuation Office Agency — VOA; evidenced by booking records). WALES: from 1 April 2023, the tests were significantly tightened — the property must be available for letting for at least 252 days per year (previously 140) AND actually let for at least 182 days per year (previously 70). The Wales tightening was a direct response to property owners claiming FHL business rates status to avoid the council tax second home premium. Properties that no longer meet the new Welsh thresholds have reverted to council tax liability — often triggering retrospective second home premium liability for property owners who had previously been on business rates. SCOTLAND: the property must be available for letting for at least 140 days per year AND actually let for at least 70 days per year (Scottish Assessors Association). DISTINCTION BETWEEN SECOND HOME AND EMPTY HOMES PREMIUMS: SECOND HOME PREMIUM — applies to properties that are FURNISHED and HABITABLE but NOT the owner's main home; the owner is currently using or has available an additional furnished property; council tax is levied on the owner (as the ratepayer) with the premium. EMPTY HOMES PREMIUM — applies to properties that are SUBSTANTIALLY UNFURNISHED and UNOCCUPIED (Local Government Finance Act 1992 s.11B for England; s.12B for Wales; s.75B for Scotland, in each case as amended); England: 100% premium after 1 year; 200% after 5 years; 300% after 10 years (Levelling-up and Regeneration Act 2023 Part 5 — replaced the previous structure). PLANNING FOR LANDLORDS: buy-to-let landlords with furnished properties between tenancies (void periods) should: (a) check the specific council's second home premium policy for the property's area; (b) consider whether the property is in a furnished or unfurnished state (furnished properties risk the second home premium; unfurnished properties may be exempt from council tax for an initial period or subject to the empty homes regime); (c) note that in Wales, the tightened holiday let business rates thresholds mean that properties previously on business rates may now revert to council tax plus second home premium — potentially significant for Welsh landlords and holiday let owners; (d) if the property is a genuine holiday let, ensure letting records are maintained to evidence the actual letting days (VOA/SAA may request records to verify qualification for business rates)
Frequently asked questions
What is the second home council tax premium in England from 2025?+
From 1 April 2025, English councils can charge up to 100% council tax premium on second homes — meaning the owner pays double the standard council tax rate. The power is in Local Government Finance Act 1992 s.11B (as amended by the Levelling-up and Regeneration Act 2023). Councils must give 12 months' notice before implementing. Not all councils have implemented the premium — it is most common in high-pressure housing areas (Cornwall, Devon, Yorkshire Dales, Lake District, Cotswolds).
What is the second home council tax premium in Wales?+
Welsh local authorities can charge up to 300% council tax premium on second homes from 1 April 2023 (maximum increased by Local Government Finance (Wales) Act 2024). A 300% premium means the owner pays 400% of the standard council tax rate. Most Welsh councils have implemented significant premiums — Gwynedd, Pembrokeshire, Isle of Anglesey, and Ceredigion have some of the highest rates. The second home premium does not apply if the property qualifies for business rates as a holiday let (252 days available; 182 days actually let per year from April 2023).
What is the difference between second home council tax and empty homes council tax?+
Second home council tax (premium applies to furnished, habitable properties not used as main home) and empty homes council tax (premium applies to substantially unfurnished, unoccupied properties) are distinct regimes. A furnished void rental property between tenancies is more likely to attract the second home premium; an unfurnished unoccupied property is more likely to attract the empty homes premium after any initial exemption period. Both can apply simultaneously if the property transitions between states.
How do landlords avoid second home council tax with holiday let business rates?+
Properties qualifying as self-catering holiday accommodation for business rates purposes pay non-domestic rates (not council tax) — avoiding both the second home and empty homes premiums. England: available 140 days/year AND actually let 70 days/year. Wales (from April 2023 — significantly tightened): available 252 days/year AND actually let 182 days/year. Scotland: 140 days available/70 days actually let. Many holiday let properties in England and Scotland qualify for 100% Small Business Rate Relief (zero business rates). Wales tightened the threshold from April 2023 specifically to prevent owners using the business rates route to avoid the council tax second home premium.
- Council tax for landlords — liability, exemptions and void periods →
- Empty homes premium — England 100%/200%/300% council tax →
- Furnished holiday let — tax regime, qualification and business rates →
- FHL abolition — changes to the furnished holiday let tax regime →
- Business rates for landlords — small business rate relief and holiday lets →
- Void periods — managing costs and insurance during vacancy →