Fact sheet: 'Replacement of Domestic Items’ relief for landlords

The UK Government has ended the Furnished Holiday Lettings (FHL) rules. Since 6 April 2025, all holiday lets are taxed in the same way as normal rental income. This applies across the whole UK and affects anyone running a holiday let, Airbnb-style rental, cottage, annexe, or other short-stay property.

Centre for London has called for a Proportional Property Tax as part of a wider plan to tackle London’s housing crisis. The city not only needs more homes, but also a better way to use, fund, and distribute the homes it already has. Although the report focuses on the capital, many of the pressures it identifies are felt across the UK, including a shortage of social housing, high moving costs, a lack of suitable homes for older people, and barriers to new development.

The UK Government has launched a consultation on the design of the surcharge, first announced in the 2025 Autumn Budget, which is expected to apply to homes in England valued at £2 million or more from 2028. If the reforms are to address unfairness in the existing system effectively, property values must be assessed consistently and updated regularly and clearly so consumers can calculate their council tax.

The UK Government has set out further reforms across housing, communities, and local government. Proposals affect leasehold, building safety, social housing, local authority standards, and tourism levies, all of which could impact local housing markets and influence the way councils, owners, agents and residents interact.