The Non-Domestic Rating (Amendment of Definition of Domestic Property) (Wales) Order 2026

Made: 19 January 2026

Coming into force: 1 April 2026

The Welsh Ministers make the following Order in exercise of the power conferred on the Secretary of State by section 66(9) of the Local Government Finance Act 1988[^f00001] and now vested in them.

Title, coming into force and interpretation

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• (1) The title of this Order is the Non-Domestic Rating (Amendment of Definition of Domestic Property) (Wales) Order 2026 and it comes into force on 1 April 2026.

• (2) In this Order “the Act” means the Local Government Finance Act 1988.

Application

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• (1) The amendments made by article 3(2) and the new section 66(2BBA) of the Act inserted by article 3(3) apply in relation to an assessment day that falls on or after 1 April 2026.

• (2) The new section 66(2BBB) of the Act inserted by article 3(3) applies in relation to an assessment day that falls on or after 1 April 2026 in relation to lettings on or after 1 April 2026.

• (3) In this article, “assessment day” means the day in relation to which the question referred to in section 66(2BB) of the Act is being considered.

Amendments to the Local Government Finance Act 1988 - definition of domestic property

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• (1) Section 66 of the Act is amended as follows.

• (2) In subsection (2BB)[^f00002]—

• (a) in paragraph (a), after “being considered” insert “(“year A”)”;

• (b) in paragraph (c), for the words “prior to the year beginning with end of the day in relation to which the question referred to in paragraph (a) is being considered” substitute “immediately preceding year A”.

• (3) After subsection (2BB) insert—

(2BBA) If a building or self-contained part of a building was not let for at least 182 days in the year immediately preceding year A, it is to be taken to have been so let for the purpose of subsection (2BB)(d)(i) or (ii) if it was let for a total of at least 182 days when calculated as an average of the number of days it was let per year either— (a) in the two years immediately preceding the day in relation to which the question is being considered; calculated by taking the average of the number of days it was let— (i) in the year immediately preceding that day, and (ii) in the year beginning two years immediately preceding that day, or (b) in the three years immediately preceding the day in relation to which the question is being considered; calculated by taking the average of the number of days it was let— (i) in the year immediately preceding that day, (ii) in the year beginning two years immediately preceding that day, and (iii) in the year beginning three years immediately preceding that day. (2BBB) The number of days for which a building or self-contained part of a building is let or is intended to be available for letting includes, for the purpose of subsection (2BB), up to 14 days where the building, or part of the building, is let or intended to be available for letting— (a) under an arrangement with a charity registered in accordance with section 30 of the Charities Act 2011[^f00003], and (b) for use free of charge by the charity’s beneficiaries as self-catering accommodation for short periods.

Signed

Mark Drakeford — Cabinet Secretary for Finance and Welsh Language, one of the Welsh Ministers — 19 January 2026

Explanatory note

(This note is not part of the Order)

EXPLANATORY NOTE

This Order amends section 66 of the Local Government Finance Act 1988 (“the Act”) which defines domestic property for the purposes of Part 3 (non-domestic rating) of that Act.

Section 66(2BB) of the Act sets out the circumstances in which a building, or self-contained part of a building, which is commercially let for short periods as self-catering accommodation is not domestic property and therefore liable to non-domestic rates. Under section 66(2BB) such property is not domestic if the owner intends to let it for short periods totalling 252 days or more in the coming year, it was available for letting for 252 days or more in the previous year, and it was so let for at least 182 days in that year.

Under section 66(2BB)(d)(ii) of the Act, where a building or self-contained part of a building was let for less than 182 days in the previous year it will nevertheless not be domestic property in certain circumstances. That is, where it is part of a business which lets other such buildings or parts of buildings at the same location or within very close proximity of each other and, taken together, the average number of days for which they were each let over the previous year was at least 182.

Article 2 of this Order amends section 66(2BB) and inserts new section 66(2BBA) into the Act. Under this new provision, if a building or part of a building was not let for at least 182 days in the previous year, it is to be taken to have been so let if it was let for at least 182 days when calculated as an average of the number of days it was let per year in the previous two or three years. This also applies if the number of days the building or part of the building was let in the previous year was calculated under section 66(2BB)(d)(ii) as an average of the buildings let as part of the same business.

Article 2 of this Order also inserts new section 66(2BBB) into the Act so that the number of days for which a building or part of a building is let, or is intended to be available for letting, for the purposes of subsection (2BB) includes up to 14 days where it is let or intended to be available for letting free of charge by the beneficiaries of a charity. The building or part of the building must be let, or available for letting, under an arrangement with a registered charity as self-catering accommodation for short periods beginning on or after 1 April 2026.

The Welsh Ministers’ Code of Practice on the carrying out of Regulatory Impact Assessments was considered in relation to this Order. As a result, a regulatory impact assessment has been prepared as to the likely costs and benefits of complying with this Order. A copy can be obtained from the Non-Domestic Rates Policy and Reform Division, Welsh Government, Cathays Park, Cardiff, CF10 3NQ.

Footnotes

[^f00001]: 1988 c. 41. The power under section 66(9) was, so far as exercisable in relation to Wales, transferred to the National Assembly for Wales by virtue of article 2 of, and Schedule 1 to, the National Assembly for Wales (Transfer of Functions) Order 1999 (S.I. 1999/672). By virtue of section 162 of, and paragraphs 30 and 32 of Schedule 11 to, the Government of Wales Act 2006 (c. 32), the power is now vested in the Welsh Ministers.

[^f00002]: Section 66(2BB) was inserted by S.I. 2010/682 (W. 65) and applies only in so far as Part 3 of the Act applies in relation to Wales. It was amended by S.I. 2016/31 (W. 12) and S.I. 2022/563 (W. 129).

[^f00003]: 2011 c. 24. Section 30 was amended by S.I. 2016/997.