There are a vast amount of taxes that you will be expected to pay on a property that is empty, and what these taxes are will depend on what the property is being used for.
The first tax on properties is the dreaded Council Tax. If you are using the house as your second home, meaning that the property is empty for a lot of the time, then you may be eligible to a Discount On Your Council Tax. The discount you are eligible to can often depend on the location of the property and which council tax band it falls under.
A lot of local authorities will operate different systems in terms of what taxes you will have to pay. If you are unlucky, some local councils may hold a negative view on second home users, so may punish them by charging more tax. Typically, a discount of 10-50% of the council tax bill will apply to second homes.
Who Can Apply For The Discount?
Properties may be exempt from council tax if they are unoccupied and unfurnished. Most councils now charge full council tax from day one, and the property must be unoccupied for the entire period. This period is extended to 12 months if the property must remain unoccupied because of alterations necessary to make it habitable.
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Enter your salary and get a clear breakdown of your income tax, National Insurance, and take-home pay for the 2025/26 tax year. See exactly where your money goes.
Try our Income Tax Calculator free, here on this site →If you are using the second home as a holiday home, then a local council is likely to be less sympathetic with you in terms of your council tax payments, and what they will expect you to pay. If, however, your work requires you to have a second home and you are provided with the property as part of your work, then they will offer you a 50% discount on your council tax payments.
Properties empty for over one year are subject to additional premiums of up to 300%, which could come in handy of you are trying to sell your property but not having much luck. The best thing to do is to contact your local council and explain your situation. It will be your local council that will have the final word in terms of whether or not you get a discount on the council tax.
Capital Gains Tax on Second Properties
From 30 October 2024, capital gains tax rates are 18% for basic rate taxpayers and 24% for higher rate taxpayers (the tax rate you use depends on the total amount of your taxable income, so you need to work this out first). You will normally be charged for capital gains tax if your property is worth more than you paid for it when you sell it. Having said this, your first £3,000 of total taxable gains will be tax free.
It is worth remembering that when you are trying to work out how much you will be charged, it will work in the same way as a lot of other taxes do, so you will be able to deduct some of the costs of buying the property. If you end up losing money on the property, you may be able to set some of that cost against other money you have made from things such as return if you are a landlord. Whether you are thinking of selling your property or using a property as a second home, you should always make sure your local council is aware of this so you can find out which reductions you are eligible for.
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