Second homeowners that pretend to let their properties to holidaymakers to avoid taxes, will be forced to pay an increased amount of taxes. 

The news comes as the Department for Levelling Up, Housing and Communities (DLUHC) move closer to closing a loophole in the system

The loophole allows people to access tax breaks when they dishonestly claim their second property is being used for holiday lets. 

Currently, people who own a second home in England can avoid paying council tax and even get access to small business rates relief when they declare it will be used for holidaymakers. 

Salisbury Journal: Second home owners will need to pay more tax. (PA)Second home owners will need to pay more tax. (PA)

Owners do not need to show evidence to prove their second home is a property let, allowing many to abuse the system. 

But this will change under plans that have been announced in which second homeowners will be forced to pay council tax if they cannot show they are genuinely renting out their properties on a commercial basis. 

Starting in April 2023, they will have to prove homes were let for a minimum of 70 days the previous year in order to gain cheaper tax rates. 

They will also need to show their properties were available to rent for over 140 days. 

Holiday let owners will need to provide evidence including websites, brochures, letting details, and receipts. 

Michael Gove, the Secretary of State for Levelling Up, said: “The Government backs small businesses, including responsible short-term letting, which attracts tourists and brings significant investment to local communities.

“However, we will not stand by and allow people in privileged positions to abuse the system by unfairly claiming tax relief and leaving local people counting the cost.

“The action we are taking will create a fairer system, ensuring that second homeowners are contributing their share to the local services they benefit from.”