Airbnbs & Short-lets – UK’s Changing Legislation

Ollie Whitehouse, Streo Founder & CEO

Published:

07/03/2024

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Introduction

The UK government is introducing significant changes impacting the landscape of short-term rentals, with implications for taxes, planning, fire safety, and consumer protection.

Here’s a simple breakdown of the changes over the last 12 months that you NEED to be aware of:

Taxes Changes for for Airbnbs & Short-lets

FHL tax regime abolished

From April 2025, Furnished Holiday Lets (FHLs) will lose their special tax benefits, bringing them in line with regular rental properties in terms of capital gains tax, income tax, and wear and tear allowances.

Planning for Airbnbs & Short-lets

New planning class considered

A new planning category is under discussion for short-term lets not considered someone’s primary residence. This may affect how easily you obtain permission to operate a short-let.

National register of short-lets

A mandatory national register for all short-term lets will be established, impacting registration and management processes.

Additional Considerations

Business rate relief changes

Since April 2023, second-home owners need to fulfill stricter occupancy requirements (70 days rented, 140 days available) to qualify for business rate relief, potentially increasing their tax burden.

Fire regulations

Recent updates to fire safety regulations for short-term lets in England (as of October 1st, 2023) emphasise stricter measures and broader coverage, including but not limited to:

Mandatory Fire Risk Assessments (FRAs): All properties require a detailed FRA by a qualified professional, identifying fire hazards and outlining mitigation strategies.
Enhanced Smoke and Heat Detection: Interlinked smoke and heat detectors, not just smoke detectors, are now mandatory in bedrooms, living rooms, and escape routes, offering faster fire detection in various scenarios.
Clearer Escape Routes: Escape routes must be unobstructed and well-lit with emergency lighting. Fire doors with at least 30 minutes of fire resistance are required to separate escape routes from other areas.

Trading standards investigations (R2SA ONLY)

Trading Standards, which oversees fair business practices, now has broader authority to investigate short-term rentals. This means they can look beyond misleading advertising to uncover issues like unfair fees, hidden charges, or neglecting safety concerns. They can investigate complaints from guests or proactively probe potential problems. If they find evidence of wrongdoing, they can issue warnings, fines, or even take legal action. This emphasizes the importance of running your short-term rental business ethically and transparently to avoid investigations and ensure guest protection.

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Airbnbs & Short-lets – UK’s Changing Legislation

Table of Contents

Introduction