UK Tourist Tax for B&Bs and Small Hotels: 2026 Guide

Short answer: there is no single UK tourist tax. As of 27 October 2026, B&Bs and small hotels face three different situations. In Wales, every visitor accommodation provider must register with the Welsh Revenue Authority by 31 March 2027, and Cardiff will charge £1.30 per person per night from 1 April 2027. In Scotland, Edinburgh has charged 5% (capped at five nights) since 24 July 2026, and Glasgow, Aberdeen, Stirling and West Dunbartonshire have confirmed schemes starting in 2027. In England there is no statutory levy yet. The government has confirmed it will give mayors the power to bring one in, and Manchester and Liverpool already run voluntary BID charges per room per night.

This guide covers what has been confirmed, what is still undecided, and how to show the levy on rates and invoices without upsetting guests or confusing your accountant. It is general information, not legal or tax advice. Rules and council decisions are still changing, so check your own council's page before you change prices.

If you are close to the VAT threshold, read VAT threshold for B&Bs and small hotels first. A levy you pass on to guests can count towards turnover.

Wales: register now, levy only where your council opts in

The Visitor Accommodation (Register and Levy) Etc. (Wales) Act 2025 does two separate things. It creates a national register of visitor accommodation providers, and it lets each council decide whether to charge a levy. The Welsh Revenue Authority (WRA) collects the levy on councils' behalf.

Registration applies to everyone

The register duty came into force on 1 October 2026. According to the WRA step-by-step guide, if you take bookings for overnight stays in Wales you must register by 31 March 2027, even if your council never introduces the levy. Registration is done online through the WRA service with a GOV.UK One Login. You will need your contact details, the accommodation address, the types of accommodation, when you are usually open, the number of rooms or bookable units and your maximum occupancy. Some of your details will appear on a public register.

The rates

The WRA publishes two rates:

• £1.30 per person per night for hotels, B&Bs, guest houses, self-catering lets, holiday lets, glamping and most other accommodation. This rate applies to guests of all ages, including babies.

• 75p per person per night for shared hostel, bunkhouse or dormitory rooms and for tent pitches. Under-18s are exempt at this rate.

No levy is due on cancelled stays or no-shows, on single bookings of 32 nights or more, or on council temporary housing. The WRA's own example is four guests staying seven nights: 28 overnight stays × £1.30 = £36.40.

Which councils are charging?

The WRA's council checker currently lists one confirmed council. Cardiff starts the levy on 1 April 2027, and Cardiff providers have had to account for it since 28 September 2026. In practice, new bookings (and extra nights or guests added to existing bookings) made from that date for stays on or after 1 April 2027 are in scope.

Three North Wales councils consulted in 2026 and none has gone ahead for now. Anglesey decided not to introduce a levy at present. Conwy deferred its decision until there is more evidence. Gwynedd will make a final decision once it has finished analysing its consultation. Councils can only start the levy on 1 April or 1 October and normally have to give 12 months' notice, so you should get warning. Keep an eye on the checker all the same.

Filing in Wales

You can file once a year or quarterly. If your levy goes over £1,000 a year, you must file quarterly. The annual accounting year runs from 1 April to 31 March and the return is due by 31 May. Quarterly returns are due 60 days after each quarter ends. A stay belongs to the period in which the guest checks out.

Scotland: percentage levies, council by council

Under the Visitor Levy (Scotland) Act 2024, all 32 Scottish councils can introduce a levy. Most confirmed schemes so far charge a percentage of the accommodation cost. A 2026 amendment also lets councils set fixed per-night amounts, according to VisitScotland's local authority guidance. Returns for confirmed schemes are made through visitorlevy.scot.

Sources: visitorlevy.scot and VisitScotland.org, checked 27 October 2026.

Formal consultations are open in Dundee (to 27 November 2026), Falkirk (to 25 November), Highland (to 30 November) and Perth & Kinross (to 11 November). Several other councils, including Fife, Moray and Dumfries and Galloway, are at early engagement stage. None of these has a confirmed rate yet.

What "5%" actually means in Edinburgh

The Edinburgh guidance for accommodation providers is the most detailed in the UK, and it explains the method other Scottish schemes are likely to follow:

• The levy is 5% of the accommodation-only part of the price, net of VAT. Meals, drinks, parking, optional laundry and transport are excluded. Cleaning that is always included in the room price counts as accommodation.

• For VAT-registered businesses, the levy counts as turnover and VAT applies to it. Ask your accountant if you are unsure.

• Returns are quarterly in arrears. The first return (stays from 24 July to 30 September 2026) was due by 30 October 2026, with payment by 13 November 2026.

• Keep records for 5 years from the date you submit the return.

England: no statutory levy yet, but it is coming

England currently has no statutory tourist tax. The government's Overnight Visitor Levy consultation ran from 26 November 2025 to 18 February 2026. The government response, published on 10 September 2026, confirmed these points:

• All mayoral and foundation strategic authorities will get the power to introduce a levy.

• The levy will be a percentage of the accommodation cost, not a flat fee, and meals are excluded. Authorities cannot vary the rate by season or accommodation type.

• Accommodation providers will be liable and will self-assess.

• Authorities must consult locally and give businesses advance notice. No national minimum notice period has been set.

• The government intends to legislate in the current parliamentary session. Subject to Parliament, it expects local leaders to set out revenue plans by March 2028.

So if you are in a mayoral area such as Greater Manchester, the West Midlands or the North East, plan for a percentage levy at some point. No dates or rates exist yet.

Manchester and Liverpool's existing charges

Two cities already add a per-room charge through accommodation Business Improvement Districts (BIDs) rather than a council-run tax. The Manchester Accommodation BID City Visitor Charge has been in place since April 2023. It adds £1 (plus VAT where applicable) per room or unit per night at most paid accommodation in the BID zone. Liverpool has added £2 per room or unit per night since 1 June 2025. Whether a small B&B is covered depends on the BID's own rules and boundary, so check with the BID directly.

Showing the levy on rates and invoices

The Welsh guidance on covering levy costs describes three options, and they work anywhere:

1. Absorb it. Keep your prices the same and pay the levy from your margin.

2. Raise your prices. Build the levy into your rates.

3. Charge it as a separate line. If you do this, show it in your advertising, and make sure each booking shows the stay price, the levy and the total.

Most small properties choose option 3, because guests can see where the money goes. To do it well:

• Use a separate line item on the confirmation and invoice. In Wales, show it per person per night (for example, "Cardiff Visitor Levy: 2 guests × 3 nights × £1.30 = £7.80"). In Scotland, show the percentage and the accommodation amount it was calculated on.

• Keep extras off the levy base in percentage schemes. Put breakfast, parking and dinner on their own lines.

• Be consistent with VAT. In Wales, the WRA says VAT applies to the total the guest pays, including any levy fee, but VAT must not go on your levy return. Edinburgh calculates the levy on the price net of VAT. Agree a method with your accountant before you set up your invoice template.

• Update your cancellation wording. In Wales, if you collect the levy in advance and the guest cancels or does not show, you should refund it. See our guide to B&B cancellation policies and deposits.

OTAs vs direct bookings

You remain liable for the levy however the guest booked. Both the WRA and Edinburgh say platforms such as Booking.com and Airbnb may help add the levy, but checking it is your job. Edinburgh does not endorse any OTA calculation method.

• Know what the guest paid. Edinburgh's guidance explains that if the OTA charges its commission to the guest, the commission is part of the "initial transaction" and the levy is calculated on it too. If you pay the commission yourself, it is not included.

• Check each channel's levy setting against your council's rate and cap before the start date.

• Reconcile OTA payouts so you can see the levy on each booking. Our guide to OTA commission vs direct bookings covers payout maths.

Direct bookings are simpler, because you control the price, the levy line and when payment is taken.

Record-keeping that will survive a check

For each stay in Wales, the WRA expects you to record the date of the stay, the number of guests and the number of nights. You must also record stays that are exempt (cancellations, no-shows, bookings of 32+ nights) and keep separate totals for each rate and each address. Keep records for 6 years after you submit the return. Edinburgh asks for 5 years, plus monthly figures for accommodation revenue, available and occupied nights, and nights beyond the five-night cap.

Use the strictest rule that applies to you, and store levy records with your normal weekly reports so the quarterly return takes minutes.

How a PMS helps

A spreadsheet can work for three rooms, but it soon struggles with changes to guest numbers, split stays and OTA payouts. Look for a property management system that can:

• add a custom charge line per person per night or as a percentage of the room rate, kept separate from extras

• show that line on confirmations and invoices

• produce reports by date range (for example, by check-out date) with guest counts, nights and accommodation revenue

• let you export the figures for your accountant or the WRA and visitorlevy.scot portals

Stayvieo is built for independent UK hotels, B&Bs, guest houses and holiday lets. Plans start from £39/month + VAT (see pricing). On a demo, ask to see how custom charges and date-range reports would handle your council's levy before the start date.

FAQ

Do I have to register in Wales if my council isn't charging a levy?

Yes. Every visitor accommodation provider taking overnight bookings in Wales must register with the WRA by 31 March 2027, whether or not the council charges a levy.

Do children pay the Welsh levy?

At the £1.30 higher rate, yes, guests of all ages count. Under-18s are exempt only at the 75p rate for hostels, dorms and tent pitches.

Is the Edinburgh levy charged on breakfast?

No. It is 5% of the accommodation-only price, net of VAT, for the first five consecutive nights. Meals, drinks, parking and optional extras are excluded.

Is there a tourist tax in England in 2026?

No statutory one yet. The government confirmed in September 2026 that it will legislate for a percentage-based levy run by mayoral and foundation strategic authorities. Manchester and Liverpool's per-room charges are BID schemes, not council taxes.

Can I just absorb the levy?

Yes. You can absorb it, raise prices or charge it as a separate line. Either way you must pay it, even if a guest refuses.