Visitor Levy for visitor accommodation providers: technical guidance - Rates of the levy

There are two rates of the levy that can apply to an overnight stay in visitor accommodation that take place under a contract and in a principal council area where the levy has been introduced. The overnight stay must be provided in the course of trade or business carried on by the visitor accommodation provider.

The two rates are:

• the lower rate of the levy is 75 pence
• the higher rate is £1.30

The Welsh Ministers may amend the lower rate and the higher rate of the levy in the future.

The lower rate of 75 pence applies to an overnight stay in visitor accommodation that is:

• a pitch or area provided for camping
• a dormitory, shared room or shared area that is normally provided on the basis that may be shared with other people staying there under a different contract

This rate reflects that accommodation is likely to have shared facilities for visitors, such as shared bathrooms, kitchen space and other communal areas.

A person aged under 18 on the first night that they are entitled to stay in or at visitor accommodation where the lower rate of the levy applies, should be disregarded when calculating the amount of levy payable in respect of that contract.

Pitch or area provided for camping

The lower rate of the levy applies to pitches or areas for camping.

The lower rate applies to tent pitches used for camping but does not include pitches or areas provided for mobiles homes, such as caravans and campervans. The higher rate of the levy will apply to pitches or areas provided for motorhomes, or similar accommodation.

Dormitory or other shared room or area

The lower rate also applies to visitor accommodation where the contract is for a bedspace in a shared area or room. This would generally include dormitories, huts, bunkhouses, hostels and bothies.

The key principle is that the booking and contract is for a space where the room or area may be shared with other people who have booked a space under a different contract.

Private rooms that are available in hostels or similar accommodation year-round would not be lower rated as the booking and contract will be for the entire room. As others could not book a space in that private room under a separate contract, the lower rate of the levy cannot apply.

However, where a visitor accommodation premise is normally lower rated, but a club, association or other group book out the entire visitor accommodation, then it will remain lower rated. This is because the visitor accommodation is normally provided on the basis that it is shared between individuals under different contracts.

Example 1

A Mountaineering club has booked an entire hut to stay out over a weekend as part of their hiking trip. The hut is normally booked by individuals needing a bedspace in a shared dormitory style room. As accommodation is normally provided on the basis that it may be shared with other people, the group booking by the Mountaineering club would remain at the lower rate of the levy.

Example 2

A youth hostel is typically booked by bed space. However they occasionally allow larger groups to book the entire accommodation for events. As the lower rate of the levy usually applies to youth hostels, it continues to apply where there is an occasional larger, private booking.  

The higher rate of £1.30 applies in relation to an overnight stay in all other visitor accommodation.

It most cases, it will be clear where the higher rate of the levy applies, given that the lower rate only applies to two accommodation types, which are tent pitches for camping and shared dormitory style accommodation.

The higher rate of the levy will therefore apply to accommodation, including:

• hotels, bed and breakfasts, guesthouses and similar accommodation
• pitches or areas provided for caravans, motorhomes and campervans
• self-catering accommodation, such as:
  • lodges
  • chalets
  • cottages
  • holiday lets
  • caravan parks
  • shepherd’s huts
  • glamping sites
  • homestays or spare rooms, such as those booked on Airbnb
• temporary accommodation for events, as long as they are not tent pitches for camping

Pitches or areas provided for caravans, motorhomes and campervans

Where a pitch or area is booked and the contract is for a mobile home or similar, the higher rate of the levy will apply. Where the mobile home has a tent annexed to it, or near it, the higher rate will continue to apply as the contract is for the pitch or area on the basis that a mobile home will stationed.

Specific self-catering units

The higher rate of the levy will apply where the contract for the overnight stay is in a self-catering premise that is provided by a visitor accommodation provider, such as a glamping pod, shepherds hut, yurt or similar accommodation type. Whilst many of these accommodation types may be based near pitches or areas for tents, the visitor is contracting to stay in a specific accommodation type which is provided by the visitor accommodation provider, rather than at a pitch or area that a visitor can use for their own accommodation. Therefore, the higher rate will apply to overnight stays in these forms of accommodation.

The Welsh Ministers may, by regulations in the future, add, vary or remove a type of visitor accommodation or description of visitor accommodation for the purposes of determining which rate of the levy applies.