Huge bills caused by premiums charged on top of council tax for self-catering holiday lets in Powys that have been moved over from business rates, might be cut by senior councillors.

At a meeting of Powys County Council’s cabinet on 24 March, senior Liberal Democrat and Labour councillors will receive a report updating them on the situation for over 250 self-catering holiday units in Powys that are being transferred over from business rates to council tax.

This is a consequence of failing to meet the new Welsh Government criteria over the number of days they are available or are let during the year.

The council charges a 100 per cent premium on long-term empty properties which doubles the bill, and 75 per cent on periodically occupied dwellings which are second or holiday homes.

The report explained that as the properties fall into the “periodically occupied” criteria, a 75 per cent premium applies to them as well as the standard council tax charge.

In some cases, a complex of several holiday cottage could be rated as a single business for the business rates but as separate properties for council tax.

The council is allowed to backdate these bills to 1 April 2023.

This means bills of up to £55,000 have been issued to some owners as a result of this change.

A report to be put before member says this has resulted “in significant financial difficulties for the businesses and owners affected.”

The report said: “The council tax team has seen a significant increase in work associated with premium queries and challenges, with avoidance tactics being attempted on frequent basis, resulting in nine tribunal hearings to the Valuation Tribunal Service since 2023.

“The transfer of large numbers of self-catering units from business rates to the council tax list has resulted in a high level of correspondence from distressed customers, due to the large, backdated bills they have received.”

The report goes on to explain that the side of the ledger on council tax collection rates for properties where a premium is being charged is in arrears to the tune of £2.433m as of 1 April 2025.

At the meeting it is expected that finance portfolio holder, Cllr David Thomas will recommend that councillors vote for option one in the reports which is that: “The owners will pay council tax on the property from 1 April 2023, but the premium on top of 75 per cent will be waived up to the date when the VOA decided it was liable for council tax.”

Cllr Thomas said: “Option one is the preferred option as it upholds the fundamental principle that the standard council tax liability should apply once a property has been transferred to the council tax list by the Valuation Office Agency.”

He says that asking for the basic payment up to their date of transfer is “fair” and consistent.

The report explains that those who have already paid their bill in full will be refunded.