For agents working with holiday lets, serviced apartments, hotels and mixed-use portfolios, it is important to understand both what is changing in the law and which schemes are already planned under the existing rules.
What is changing?
The 2024 Act currently allows councils to charge a percentage of the accommodation cost on paid overnight stays, with income ringfenced for services and facilities used by visitors.
Following feedback from local authorities and the tourism sector, Ministers now plan to introduce a Visitor Levy (Amendment) (Scotland) Bill in early 2026. If passed, it will do three main things:
- Offer a fixed-fee alternative to percentage charges
- Allow different rates in different circumstances
- Clarify how levies work through third-party platforms
Councils will still be able to use a percentage model, or they will have the option to set a fixed amount per night. Additionally, they will be able to set different fixed amounts for different geographical areas, times of year, or types of accommodation. This is intended to let councils tailor schemes to local markets – for example, higher seasonal charges in high-pressure areas, or differentiated treatment of hostels versus hotels.
The amendment will also spell out how the levy must be applied where bookings are made via online travel agents and platforms, and what information accommodation providers must give to councils to support collection and enforcement.
When will visitor levies actually start?
Although the Visitor Levy (Scotland) Act 2024 is now on the statute book and its main provisions came into force on 20 September 2024, the levy itself is not yet live anywhere.
In practice, the first scheme is expected to start in Edinburgh from 24 July 2026, with the levy applying to stays on or after that date where the booking is made on or after 1 October 2025.
The amendment Bill is intended to be introduced in early 2026, and Ministers hope it will pass in the current parliamentary session. For agents, this means 2026 will be the key year when both the detailed rules and the first council schemes crystallise.
Edinburgh – first scheme confirmed, housing spend agreed
From 24 July 2026, a 5% charge will apply to the accommodation-only cost of paid overnight stays within the city boundary.
The levy is calculated before VAT, applies to the first five consecutive nights only, and covers hotels, B&Bs, self-catering and short-term lets, hostels, campsites and similar paid accommodation.
Edinburgh expects the levy to raise up to £50 million a year for investment in services and infrastructure that support the visitor economy. The Council has now approved the first spend programme linked to levy income: a £5 million Housing and Tourism Mitigation Fund.
This could help deliver around 472 affordable homes between 2026/27 and 2028/29, more than three-quarters of which may be for social rent. The aim is to reduce the use of B&Bs and hotels as temporary accommodation, freeing those rooms back up for tourists while supporting workers in the visitor economy to live in the city.
The housing spend still requires final budget approval in February 2026, but it signals a clear link between visitor levy income and housing pressures.
What this means for members
Although the details are still moving, some practical implications are already clear for agents operating in Scotland.
Depending on how the amendment Bill progresses, different charging structures may operate in different council areas. Systems used by agents and landlords will need to cope with percentage-based charges, fixed per-night or per-person fees, and seasonal or area-based variations.
Many schemes, including Edinburgh’s, cover short-term lets as well as traditional hotels and B&Bs. Agents managing mixed portfolios will need clear processes to identify which stays attract a levy, calculate and collect the correct amount, and ensure it is recorded and remitted accurately.
Landlords, especially those new to the sector, will need clear explanations of when the levy applies, how it interacts with VAT and other local charges, and how it should be presented in advertising and on invoices to guests.
