The Autumn Budget has brought further changes for property owners, but holiday letting continues to offer exciting opportunities, particularly in popular destinations such as Bath.

Following the Chancellor’s Autumn Budget on 28th October 2026, landlords and holiday rental owners may be wondering how the latest announcements could affect their properties. While there are some changes worth understanding, the fundamentals of a successful holiday rental remain much the same: a desirable property, consistent guest demand, competitive pricing and effective management.

Property Income Tax Changes

One of the most significant developments is the increase in Income Tax on rental profits, announced in the previous Budget and due to take effect from April 2027.

The new property income tax rates are:

• Basic rate: 22%
• Higher rate: 42%
• Additional rate: 47%

Importantly, these changes affect taxable property income from both holiday lets and traditional residential rentals. Holiday letting hasn’t been singled out. Instead, the changes highlight the importance of maximising rental performance and managing expenses effectively.

Business Rates & Holiday Accommodation

Qualifying holiday lets in England may be assessed for business rates rather than council tax, provided they meet the relevant letting and availability requirements.

Some properties may also qualify for Small Business Rate Relief, potentially reducing their annual liability.

With changes to business rates and hospitality reliefs, owners should review their property’s eligibility to ensure they’re benefiting from any available support.

Managing Rising Operating Costs

Changes to employment costs and wider operating expenses can affect services such as housekeeping, laundry and property maintenance.

However, professional holiday let management can help owners control costs while maintaining high standards. At Roost Bath, we use dynamic pricing, efficient operations and proactive property management to help owners achieve competitive returns throughout the year.

Holiday Letting vs Long-term Letting – Which Is Better?

For landlords reviewing their investments, holiday letting can offer several advantages over a traditional tenancy.

While long-term rentals provide predictable monthly income, holiday lets offer the flexibility to adjust nightly rates according to seasonal demand, weekends and local events. In Bath, peak seasons and popular occasions such as the Christmas Market, university graduations and summer festivals provide opportunities to maximise revenue.

Although operating costs are generally higher, a well-managed holiday rental in a desirable Bath location can generate stronger net returns than a traditional long-term tenancy.

Is Holiday Letting Still Desirable?

Bath remains one of the UK’s most established visitor destinations, attracting tourists throughout the year. From weekend city breaks to family holidays and corporate stays, demand for quality accommodation creates opportunities for property owners.

The Autumn Budget may bring changes to consider, but it doesn’t alter the fundamentals of a successful holiday rental: an excellent location, competitive pricing, professional presentation and outstanding guest service.

With the right approach, holiday letting can remain a rewarding property investment.

Considering holiday letting your property in Bath? Contact Roost Bath today for a free, no-obligation appraisal.