Home Somerset business Second owners expect £191m windfall from Omicron grants

Second owners expect £191m windfall from Omicron grants

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Second home owners who have turned their holiday homes into rental businesses are set to get around £191m in new pandemic grants from the government, despite a new crackdown.

Councils across England have started handing out £635million in grants to businesses hit by the government’s Plan B restrictions and caution over the spread of the Omicron variant.

However, new analysis by property tax specialists at Altus Group has revealed that almost a third of this funding pot will go to owners who have reversed their holiday pensions.

The consultancy said holiday home owners are able to save tens of millions of pounds by taking advantage of the government‘s small business rate relief scheme while paying little or no tax.

Holiday home owners who make their properties available for rental for 140 days of the year are entitled to claim 100% relief from small business rates if the properties have a rateable value of less than £12,000, meaning they pay no corporate rate or council tax.

Hospitality, leisure and accommodation businesses that have been impacted by Omicron can now apply for one-off grants of up to £6,000 for each of their properties, depending on the assessment of its business rates, after the government provided funding to councils last week.

Those business premises, which specifically cover holiday homes, with a rateable value of exactly £15,000 or less will receive a payment of £2,667 while those with a rateable value of over £15,000 but less than £51,000 £ will receive £4,000.

The maximum grant of £6,000 is available to companies occupying properties with a rateable value of exactly £51,000 or more.

Altus said there were now 70,729 homes in England classed as holiday homes that have been turned into “business” premises, up from 56,102 just before the pandemic started in March 2020, and are now entitled to 190 £.61 million in Omicron grants.

The government has announced that from April 2023, in order to access the relief, owners of second homes will have to prove that holiday rentals are not only made available for 140 days a year, but are also actually rented for a minimum of 70 days per year.

Robert Hayton, UK chairman of Altus Group, said: “This change will mean second home owners will no longer be able to avoid paying business rates or council tax and will be entitled to business support by simply stating that their property is available for rent but making little or no effort to let it out.

Michael Gove, Secretary of State for Leveling Up, said: “We will not sit idly by and allow people in privileged positions to abuse the system by unfairly claiming tax breaks and leaving local people to count. the cost.”

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