What council tax premium rates apply to second homes in England in 2026?

Full answer

English local authorities were given powers from 1 April 2025 to apply a premium of up to 100% on the council tax bills of second homes. This means the council tax bill could be doubled for qualifying properties. What is a second home for council tax purposes? A second home is a furnished property that is not the owner's sole or main residence. It is periodically used by the owner but not rented out on a sustained basis. This distinguishes it from: -- A long-term empty property (unfurnished, unoccupied -- subject to the separate empty homes premium) -- A property let commercially (tenants pay council tax) -- A main residence Who decides whether to charge the premium? Each billing authority (district council, unitary authority, or metropolitan borough) decides independently whether to apply the second homes premium, and at what level (up to 100%). Councils must give 12 months' notice before implementing the premium. Some councils implemented it from April 2025; others are phasing it in. Exemptions Certain second homes are exempt from the premium: -- Properties occupied for job purposes only (e.g., a minister of religion's residence, or accommodation required for a job that must be kept available) -- Properties owned by armed forces personnel who are required to live in forces accommodation as their main residence -- Properties requiring substantial repair before occupation Furnished holiday lets Properties operated as furnished holiday lets (FHL) previously had business rates treatment rather than council tax in many cases, removing them from the residential council tax system. However, following the abolition of the FHL tax regime from April 2025, some properties formerly classified as FHL may now fall under council tax (and potentially the second homes premium). Wales and Scotland Wales has had powers to charge up to 300% premium on long-term empty homes and 100% on second homes for several years. Many Welsh councils charge the full 100% second home premium. Scotland has its own system, allowing removal of the 25% single occupier discount and applying premiums of up to 100% on second homes and long-term empty properties. Planning your tax position Second home owners should check whether their local council has adopted the premium and at what level. Letting the property to tenants removes it from second home status (tenants pay the council tax). Selling and investing the proceeds through a LISA or other wrapper may be more tax-efficient for some owners given the combined impact of SDLT (including the 3% additional dwelling surcharge) and council tax premiums.

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