MORE than 100 holiday home owners have opted to pay reduced business rates instead of council tax after Ceredigion council hiked levies on second homes, in a move likely to cost the council thousands of pounds each year.

In April this year, a 25 per cent council tax levy – voted through in 2015 – came into effect, leaving second home owners in the county paying more for council tax.

In the run up to the introduction of the tax, 75 properties switched from council tax to non domestic rates, with a further 43 switching since April, figures obtained by the Cambrian News show.

It was warned at the time of introducing the levy that second home owners could switch, with the council coffers missing out on vital cash earmarked for community improvement schemes.

The council projected that charging the 25 per cent levy on the around 2,000 second homes in Ceredigion would bring in around £500,000.

The council said it had now had to alter budget projections based on the amount of owners switching to business rates – with more likely to follow.

Those that successfully applied were also able to backdate payments, leaving the council having to fork out for overpaid council tax.

Residential properties used as second home are liable to full council tax – and now in Ceredigion liable for the extra payment.

However, owners of rented holiday homes that have switched to business rates need only pay if the business’s rental income is sufficiently high – saving hundreds of pounds a year.

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