Tourist accommodation Council Tax appeal

Elgan Hearn Local Democracy Reporter

As the owners of 270 self-catering holiday units appeal against paying Council Tax, a councillor has questioned whether not collecting these bills is impacting its budget.

At a meeting of Powys County Council’s Governance and Audit committee on Wednesday, September 10, Cllr Pete Lewington raised the issue as members discussed an item on Treasury Management performance between April 1 and June 30.

The report includes a section on collection rates for Council Tax and National Non-Domestic Rates (NNDR – business rates).

According to the report the collection performance during the three-month period showed that Council Tax collection was down by 0.15 per cent on 2024/2025.

The amount of historic uncollected Council Tax is at £8.49 million, and the report explains that this is due to: “270 self-catering units moving from business rates to Council Tax, the vast majority of those moving did so during 2024/25 and bills were backdated to 2023 where appropriate.”

These units are expected to pay a Council Tax premium of an extra 75 per cent on top of the normal charge.

This could generate an extra £2.5million for the Powys budget, but collection is on hold as owners appeal against the move to the Valuation Office Agency (VOA).

Implications

Cllr Pete Lewington (Conservative – Newtown West) said: “The report talks about self-catering units and a large amount of Council Tax not being collected as many of these units are appealing the decision to move from Business Rates to Council Tax.

“If that appeal is successful, what would be the implications on our budget?”

Director of Corporate Services and s151 officer, Jane Thomas said: “This is a change we have seen implemented by Welsh Government a little while ago and the valuation office has been catching up in terms of the assessments.

“This goes back a couple of years and some of the businesses have been hit by Council Tax bills that can be tens of thousands of pounds, particularly if they have more than one unit.”

Payment plan suggestion

Ms Thomas said that the council had not known about the numbers in Powys that would be moved from one category to another.

Because of this Ms Thomas explained that the council had not included the “potential income” in this year’s budget calculation, but it was “likely” to be added in the future.

This would be done by adding the units to the base budget which calculates how many homes there are across the county liable for Council Tax.

The annual calculation is usually agreed by senior councillors before Christmas and heralds the start of the annual budget production process.

Ms Thomas said: “The fact that we didn’t foresee an increase in income means that it won’t have a fundamental impact on our budget.”

The council is “talking” to the affected property owners and “suggesting” putting payment plans in place even as they go through the appeals process.

Mr Thomas said: “We’re keeping it all under review at the moment.”