Council tax on London short lets: second homes and the 90-night rule

Many London boroughs now charge double council tax on second homes, and a short let that nobody lives in usually counts as one. In London, council tax also affects whether you can use the 90-night rule at all. Check both before you list.

Here is how the charges work, which boroughs apply them, and the London twist most owners miss.

What is London's second home premium?

Since 1 April 2025, councils in England can charge a premium of up to 100% on second homes. Tower Hamlets describes a second home as a property that is nobody's sole or main home but contains furniture, and charges the premium on top of the normal bill, making the total 200%.

In plain terms, you pay twice the normal council tax.

Which London boroughs charge the premium?

Each borough decides for itself, so the answer depends on your address:

• Westminster applies a 100% second home premium from 1 April 2025.
• Tower Hamlets applies a 100% premium from 1 April 2025.
• Kensington and Chelsea did not charge the premium in 2025/26, but its budget for 2026/27 includes a 100% premium on second homes.

Kensington and Chelsea shows how quickly this can change: no premium one year, a 100% premium the next. Rates can change with each annual budget, so check your borough's council tax page before you work out your costs.

What are the exceptions?

There are exceptions set by the government. Tower Hamlets lists them, including homes actively marketed for sale or to let, for up to 12 months, annexes used as part of a main home, homes where probate was granted in the last 12 months, job-related homes, and caravan pitches and boat moorings.

A home used for short lets does not usually fit any of these, so expect the premium if your borough charges it. If you think an exception does apply, send your council the evidence and ask for it in writing.

How does council tax affect the 90-night rule?

This is the part most owners miss. London's 90-night exception only applies if the person providing the accommodation is liable to pay council tax on the home. Camden's planning documents describe the condition as council tax, not business rates.

In our reading, that means a London short let moved onto business rates may lose the protection of the 90-night exception. Without that exception, every short-stay night could need planning permission. We explain the rule in full in London's 90-night rule for Airbnb, explained. Take advice before you change how your home is rated.

When do business rates apply?

Outside London, many holiday lets move from council tax to business rates. In England, a property is assessed as self-catering if it is available to let for 140 days or more in the year and actually let for 70 days or more. The Valuation Office Agency makes that decision, not the council.

In London, the council tax condition above makes this more complicated, so do not assume business rates will save you money.

How is short-let income taxed?

The furnished holiday let tax regime ended on 6 April 2025. Short-let income is now taxed under the normal residential landlord rules, after allowable costs such as cleaning, repairs, insurance and management fees. Speak to an accountant about your own position.

Should you tell the council when the use changes?

Council tax depends on how the home is used. If you move out and start letting, if a long-stay guest makes it their main home, or if you sell, tell your borough's council tax team. Getting this wrong can mean a backdated bill or a missed exception.

Which records should you keep?

For each tax year, keep your booking calendar, the nights you blocked for your own use, platform payout statements and receipts for costs. The same records answer questions about council tax, the 90-night count and your tax return.

How do the fixed costs add up?

Before you decide, add up the costs you pay whether or not a guest books:

1. Council tax, including any second home premium in your borough.
2. Utilities, broadband and TV licence.
3. Insurance suitable for short stays.
4. Safety checks, including gas, electrical and a fire risk assessment.

Set those against realistic earnings from your 90 nights and any longer stays. Our guide to medium-term lets in London shows how the two can work together.

What does this mean for you?

• Check your borough's second home premium. Westminster, Tower Hamlets and, from 2026/27, Kensington and Chelsea all charge 100%.
• Stay liable for council tax if you rely on the 90-night rule.
• Get advice before moving a London short let onto business rates.
• Tell your borough whenever the way you use the home changes.

Check the numbers for your home

Our Airbnb management in London team will show you likely earnings after fees, so you can weigh them against your costs. Get your free valuation and see whether the numbers work for your home.

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This is general information, not legal or tax advice. It is our own interpretation of the rules and figures as they stand on the date shown above, and they can change. Speak to a qualified solicitor or accountant before you act on anything here.