‘Swansea council hit us with a £15k tax bill – and two weeks to pay'

Telegraph

2 days ago

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In the four years since Guy Allen and Emma Enticott bought their holiday let in the heart of Mumbles on the Gower Peninsula, they estimate their business has contributed £90,000 to the local economy.
Their thank you from Swansea Council, however, was a backdated council tax bill for £15,000 with a 15-day deadline to pay. The shock charge was the result of a tax change two years ago that many holiday let owners have argued was never properly communicated.
The dispute centred around a decision by Welsh Labour to raise the number of days that holiday home owners would have to let their property to qualify for business rates. The minimum of 70 days was raised to 182.
Businesses that failed to reach the new target would instead pay council tax, which would then be treated as a second home, incurring a premium of up to 300pc.
The change became law from April 1 2023 but a loophole meant the 182-day target was backdated, so the requirement had to also be met in the year preceding the rule change.
The Welsh government said it wrote to holiday let owners in October 2022 to explain this stipulation. Those who received the letter complained that this only gave them six months to hit the far higher target. Others, like Allen, 62 and Enticott, 51, said they never received a letter.
'They are stealing this money from us'
And while the couple have worked hard to reach the 182-day target every year since 2023, employing a lettings agent, setting up a website and a social media page, they came up 11 nights short of the target in 2022-23.
They didn't think this was an issue until they received a letter on July 17 from Swansea Council demanding £15,189 by August 1 for three years' worth of council tax, all of which had a 100pc premium applied.
Allen said: 'What they have done is they have taken us off business rates completely.
'It means the council has now effectively charged us for six years of council tax and this is the first we've heard of it.
'We've spoken to the Valuation Office and it's going to take up to nine months for us to get back on to business rates because of the backlog. They will end up having to repay us for the years we have hit the target and therefore should be on business rates, but in the meantime [the council] is stealing money from us.
'They are going to have the benefit of our money and the interest on it for nine months before having to pay us back.'
'Paying the price for council incompetence'
The Telegraph previously revealed how some Welsh authorities were taking holiday let owners to court to try to recoup backdated bills of up to £13,000.
Alistair Handyside, of trade body the Professional Association of Self Caterers, described the policy as 'effectively [being] retrospective legislation'.
He said there was no finite data on the number of holiday lets in Wales, so it was highly likely that letters were not sent to all homeowners.
While Allen, head of sales at a watches firm, and Enticott, who manages several properties, were able to pay the bill, they said they had concerns for the countless other holiday let owners who would not be able to afford the bill.
Enticott said: 'Guy and I are old enough and ugly enough, we have got each other's backs, and are a strong couple. But my major thoughts are for people who are facing ruin. They've got the bills to service, and they've got no other income stream. As an industry we are facing an absolute crisis.
'People cannot take the pressure anymore, and they've got absolutely no chance of hitting 182 days in some parts of the country.'
Allen added: 'The heavy lifting of the tourism industry is carried by furnished holiday lets and we are being killed for the sake of covering up the Welsh government's incompetence.
'You only have to go through every one-horse town in Wales to see the petrol station has closed down, the pub has closed, the chapel has closed, and there are endless derelict houses.
'There are more than 100,000 empty homes in Wales, and that has nothing to do with second homes or holiday lettings, but for Mark Drakeford and his mates, it's an easy win.
'Blame somebody else for your lack of infrastructure. They have done nothing to build a sustainable economy for Wales in rural areas, and instead they want to go after holiday lets.'
A Swansea Council spokesman said: 'This was not a decision taken by Swansea Council. We advised the family that the decision to take their holiday let off business rates was taken by the Valuation Office Agency (VOA). We had no control over the decision and we have no discretion to amend it. As a result of the VOA decision, the property became liable for council tax.'
'There was no delay from the council's point of view. The VOA told us recently it had retrospectively decided to withdraw the property from business rates, backdating its decision to April 1, 2023. This triggered the need for us to issue a council tax demand, and we did this as soon as we were informed by VOA of their decision.
'We have advised the family to contact the VOA, and should the position change, we will respond to that.'
A Valuation Office Agency spokesman said: 'We cannot comment on individual cases. Following the Welsh Government's announcement of the new business rates criteria for self-catering properties, we wrote to all self-catering property owners in October 2022 to let them know about upcoming changes and how this would be assessed.
'We also published information online and engaged with industry bodies and local councils to raise awareness of the changes.
'We write to customers in Wales every two years to request lettings information. If a customer thinks their property has met the criteria to qualify for business rates, they can contact us and we will look into their case.
'If a customer informs us that they are experiencing financial hardship we will prioritise their case.'