Part of: UK Council Tax 2026 — Complete Guide to Bands, Discounts, Exemptions & Appeals → Council Tax on Second Homes — 2025-26 Premium Rules Explained
TL;DR: Since April 2025, English councils can charge a 100% premium on furnished second homes under the Levelling-up and Regeneration Act 2023, doubling the standard bill. Councils must give 12 months' notice before applying it. Most coastal and tourist authority areas have adopted it. Wales allows premiums up to 300% in 22 councils. Scotland allows up to 100%. Exemptions exist for job-related and sale-pending properties.
Last reviewed: 27 April 2026
The Legal Basis: Levelling-up and Regeneration Act 2023
The power to charge a 100% Council Tax premium on furnished second homes in England is found in section 80 of the Levelling-up and Regeneration Act 2023, which amends the Local Government Finance Act 1992. The amendment inserted provisions allowing billing authorities to designate certain furnished dwellings as subject to a premium of up to 100%.
Before this legislation, English councils could remove the old 50% discount on second homes but could not charge above the standard rate. The 2023 Act changed this, allowing a doubling of the bill for qualifying properties.
The key conditions:
12-month notice requirement: A council wishing to apply the premium must publish notice of its intention at least 12 months before the premium takes effect. This prevents sudden increases. Most councils that planned to adopt the premium from 1 April 2025 gave notice during 2023-24. Some adopted from 1 April 2026 after giving later notice.
Furnished and not sole or main residence: The premium applies only to properties that are furnished and not anyone's sole or main residence. An empty unfurnished property is not a second home for this purpose - it falls under the separate long-term empty property regime.
Discretionary, not mandatory: Not every English council has adopted the premium. Each council decides independently through its annual budget-setting process. Councils in areas with few second homes may not have adopted it. Check with your specific billing authority.
Which English Councils Have Adopted the Premium?
The greatest adoption rates are in areas with high concentrations of second homes:
Coastal and tourist councils have been among the fastest to adopt. Cornwall Council, which has one of England's largest second-home concentrations, adopted the 100% premium from April 2025. North Norfolk District Council, Scarborough Borough Council (before its merger into North Yorkshire), Lake District National Park areas, and coastal East Yorkshire councils adopted or were moving to adopt.
Urban councils with fewer second homes have been slower to adopt. Major metropolitan councils (Manchester, Leeds, Birmingham) where second homes are rare relative to their residential stock have adopted the premium but with less material impact.
Rural councils in the South West, South East, and North of England with significant holiday home markets have broadly adopted.
The MHCLG tracks adoption of the premium through its annual Council Tax statistics and local authority returns.
Financial Impact: What the Premium Costs
At the England average Band D rate of approximately £2,280, a 100% second-home premium produces a total annual bill of approximately £4,560 - double the standard rate. In higher-rate coastal councils:
Cornwall (indicative Band D approximately £2,300): Second home at Band D = approximately £4,600/year.
North Yorkshire/Lake District area (indicative Band D approximately £2,200): Second home at Band D = approximately £4,400/year.
For Band E or above properties in desirable coastal areas: Band E with 100% premium at a £2,300 Band D council = 11/9 × £2,300 × 2 = approximately £5,622/year.
The financial impact is intended to discourage second-home ownership that displaces local residents. Whether it achieves this aim is a matter of ongoing debate - the IFG and others have noted that second-home owners absorbing higher Council Tax may simply pass costs to tenants or short-term renters.
Exemptions from the Second-Home Premium
Several categories of second home are exempt from the premium even in councils that have adopted it:
Job-related second homes (Class B of the second-home exemption): Where a person is required by their employer to live at a property as a condition of employment, and they also maintain a main residence elsewhere, the employment-related property may be exempt. Evidence from the employer is required. The conditions mirror the job-related exemption under the Council Tax (Exempt Dwellings) Order 1992.
Properties actively marketed for sale or let: Some councils have adopted a discretionary policy of not applying the premium to properties actively being sold or marketed for rental. This is not a statutory exemption and varies by council.
Properties undergoing major repair: Where a property qualifies for the Class A exemption (major renovation in progress), the second-home premium does not apply during the exemption period.
New builds before first occupation: A property that has been newly built but not yet occupied may not be classified as a second home in the same way as a property that has been owned and used. Check with the Valuation Office (formerly VOA, now part of HMRC since 1 April 2026) and the billing authority.
How to Challenge a Second-Home Classification
If your council has classified your property as a second home and you believe this is wrong - for example, it is your main or only residence, or it qualifies for an exemption - the challenge process is:
1. Write to the billing authority's Council Tax team with evidence that the classification is incorrect (utility bills, electoral roll registration, GP registration, employer letter for job-related exemption).
2. If the council maintains its position, request a formal internal review.
3. If unresolved, appeal to the Valuation Tribunal for England (VTE) in England.
Band challenges (where you believe the band is wrong independently of the premium question) go to the Valuation Office through the standard Check, Challenge, Appeal process at gov.uk/challenge-council-tax-band.
The Welsh Second-Home Premium: Up to 300%
Wales has operated second-home premiums for longer than England. Under the Council Tax (Long-term Empty and Second Homes) (Wales) Regulations 2022, Welsh billing authorities can charge up to 300% premium on second homes - meaning the total bill is up to 400% of the standard rate (standard bill plus 300% on top).
As of 2026-27, 22 Welsh councils have adopted premiums, with several (including Gwynedd, Anglesey, and Ceredigion) adopting 200% premiums or higher. Gwynedd at 200% means a Band D second home owner pays approximately 3 × the standard bill. The Welsh Government's stated aim is to fund affordable housing from premium revenues.
The Scottish Second-Home Premium
The Council Tax (Variation for Unoccupied Dwellings) (Scotland) Regulations 2013 give Scottish councils the power to charge up to 100% premium on second homes and long-term empty properties. Several Scottish councils in areas with significant second-home concentrations (Highland, Argyll and Bute, Na h-Eileanan Siar) have adopted premiums. The Scottish Government's approach has been more uniform across the country than England's patchy adoption.
The 12-Month Notice Period: Which Councils Apply the Premium from When?
The 12-month notice requirement under the Levelling-up and Regeneration Act 2023 means the premium rollout happened in stages, not all at once on 1 April 2025.
Wave 1 (April 2025): Councils that passed a resolution during 2023-24 to adopt the premium from 1 April 2025. This included the majority of coastal tourist authorities - Cornwall, North Norfolk, the Lake District national park area, North Yorkshire (Scarborough predecessor area), East Lindsey (Lincolnshire coast), and others with significant second-home concentrations.
Wave 2 (April 2026): Councils that passed their resolution during 2024-25. Some metropolitan and urban councils that had lower second-home concentrations but wished to adopt the premium joined in the second wave.
Not adopted: Some councils, particularly those in major city centres where furnished second homes are rare relative to the residential stock, have not adopted the premium or adopted it at less than 100%. In these areas, the standard Council Tax rate applies to second homes without a premium. Always verify with the specific billing council.
The MHCLG publishes data on premium adoption through its annual Council Tax statistics collection. The information is also available directly from each council's website (look for the council's most recent Council Tax-setting agenda papers).
Impact on Holiday Cottage Markets
The second-home premium has been most materially felt in areas where second-home ownership is concentrated relative to local housing supply. Published estate agent data from Cornwall, the Lake District, and the Norfolk and Suffolk coasts suggests that the premium has been one factor among several affecting the second-home market in these areas - alongside changes to mortgage tax relief, the removal of furnished holiday let tax advantages from April 2025, and general economic pressures.
The Welsh Government, which has the longest experience with second-home premiums (having introduced them earlier than England), has published analysis suggesting that premiums at the 200-300% level in some Welsh councils have had a measurable effect on second-home ownership patterns in those areas, though separating the Council Tax effect from other housing market factors is complex.
Frequently Asked Questions
Which English councils have NOT adopted the second-home premium?
Councils in areas with few second homes, or those that have not completed their 12-month notice period, may not yet have adopted the premium. As of 2026-27, metropolitan councils with limited second-home stock may have adopted on paper but see little material revenue from it. The MHCLG tracks adoption; check with your specific billing authority.
The premium doubles my bill - can I appeal against the premium rate itself?
The premium rate is set by the council through the democratic budget process. You cannot appeal against the rate itself (just as you cannot appeal against the Band D rate). What you can challenge is: whether your property is correctly classified as a furnished second home; whether a specific exemption applies; and, separately, whether the band assigned to your property is correct.
If I remove all the furniture, does the premium stop?
Possibly - but with complications. An unfurnished empty property is typically classified as long-term empty rather than a second home, and a different premium structure applies. Removing furniture does not mean Council Tax stops; it means the property moves to the long-term empty premium regime, which can itself be 100% after one year. Some councils may investigate whether furniture removal is genuine or an attempt to reclassify. If the reclassification is found to have been made to avoid the premium rather than reflecting a genuine change in use, the council can apply the original classification retroactively. The MHCLG guidance to billing councils on second-home and empty property classification covers this scenario.
My second home is in Wales but I live in England - which rules apply?
The Welsh rules apply to the property in Wales. Your Council Tax liability for the Welsh property is to the Welsh billing authority, under Welsh regulations. Your English main home is subject to English rules. The two are entirely separate liabilities.
Is the second-home premium the same as the holiday let premium?
No. Holiday lets that qualify for business rates (140 days available and 70 days let in England) are outside the Council Tax system entirely. The second-home premium applies to furnished properties that do not meet the business rates threshold - typically personal holiday retreats that are not commercially let at scale.
How we verified this
The second-home premium powers are from the Levelling-up and Regeneration Act 2023, section 80. The 12-month notice requirement is in the same Act's transitional provisions. The Welsh premium regulations are the Council Tax (Long-term Empty and Second Homes) (Wales) Regulations 2022. The Scottish regulations are the Council Tax (Variation for Unoccupied Dwellings) (Scotland) Regulations 2013. Exemption class references are from the Council Tax (Exempt Dwellings) Order 1992. The Valuation Office (formerly VOA, now part of HMRC since 1 April 2026) role in band and dwelling classification is from HMRC and gov.uk guidance. MHCLG tracks premium adoption in annual statistics. The IRRV provides professional guidance to councils on premium administration.
Sources & Verification
- Levelling-up and Regeneration Act 2023 (s80 second home premium): https://www.legislation.gov.uk/ukpga/2023/55/section/80
- Council Tax (Long-term Empty and Second Homes) (Wales) Regulations 2022: https://www.legislation.gov.uk/wsi/2022/382/contents
- Council Tax (Variation for Unoccupied Dwellings) (Scotland) Regulations 2013: https://www.legislation.gov.uk/ssi/2013/45/contents
- Local Government Finance Act 1992: https://www.legislation.gov.uk/ukpga/1992/14/contents
- MHCLG Council Tax statistics: https://www.gov.uk/government/collections/council-tax-statistics
- Valuation Office (formerly VOA): https://www.gov.uk/government/organisations/valuation-office-agency
- IRRV (Institute of Revenues, Rating and Valuation): https://www.irrv.net/
- gov.uk Council Tax second homes: https://www.gov.uk/council-tax/second-homes
This article is for informational purposes only and does not constitute legal, financial, or tax advice. Council Tax rules vary by local authority and change annually. Always verify current rates and rules with your local council and gov.uk before making any decision.