Are you a short-term let owner? You’re going to face new planning permission requirements 

By Zain Saleh, Partner

The Government are trying to tackle housing shortages in areas of high demand for short-term lets and will do this by introducing new regulations. 

These will require a special category of planning permission for property owners – including you.

If you own an Airbnb or other short-term let properties, you will be introduced to the new planning legislation. 

This is expected to come in by Summer 2024 – your potential non-compliance might lead to new fees and penalties. 

The background to the changes 

The aim of these changes is to provide local authorities and councils with more control over the number of short-term let licences issued.   

The market for short-term lets has expanded in past years, and more people are deciding to enter the field on a casual basis.  

Currently, an Airbnb host in the UK earns an average of approximately £6,000 per year.  

High demand and rapidly evolving trends, combined with industries that have lots of players, mean regulation has struggled to keep up with the short-term rental market.   

Critics have stressed the difficulty of managing the quality and number of lets in areas where the need for family housing is elevated.  

This has resulted in providers such as Airbnb, and Government bodies, being subjected to criticism by consumers for failing to maintain proper licencing and security.   

What are the new requirements? 

The Government will require all owners of new short-term lets in England to secure planning permission with their local authority to use their property in this way.   

It will also introduce a new use class to planning permission regulations – this is to avoid confusion with any existing classes.  

Any current lets will automatically be reclassified and will not require planning permission.   

New regulations will also introduce a mandatory national register to record all short-term lets in England.   

The Government has considered the potential for annual registration, plus a registration fee, but this has not yet been confirmed.   

How will these new regulations affect me and my short-term let? 

What property do you let and how often do you do so? 

How these new regulations affect you will depend on these factors. 

The rules will apply to owners of new lets and will not be reviewed. 

Therefore, they will not apply to properties that you already rent out.   

You might need to put off or reconsider the purchase of a new let, however this will depend on your individual situation.   

If you are a homeowner and let out your sole or main home for up to 90 nights per year, these new regulations will also not apply to you. 

The existing ‘change of use’ charges range from £120 to £258, with the majority set at £120, however the cost of planning permission has not yet been clarified so it is important you keep an eye out for updates. 

The mandatory register might also have some unexpected consequences for business owners.   

It is suggested that HM Revenue & Customs (HMRC) could have access to the register.  

Due to this, we must stress the importance of tax compliance for anyone operating a short-term let in England.   

Contact us for support  

Planning is crucial to maintaining compliance with new regulations. 

You must ensure that your business has the funds and other resources to meet these requirements.   

We will help you to plan around the additional costs of obtaining planning permission and any continuing compliance costs.  

If you operate your short-term lets as your main business or wish to grow a side business, we will also advise you on incorporating these compliance measures into your business plan.   

Don’t let your business become non-compliant. Get in touch with our team today.   

Posted in blog, Business, HMRC, Tax.