Row over Powys couple's £9,000 council tax surge on garden cabin

When Hazel and Richard Cullen moved into their home near Hundred House with teenage daughter Meg in 2019, she was delighted when they found a ready-built cabin hidden in undergrowth on the property.

Hazel, a retired hairdresser, had always wanted to open a B&B so saw the cabin as an opportunity to realise her dream, converting it into a tourist getaway in the idyllic Powys countryside.

But, her dream has become a nightmare, with Powys County Council insisting the cabin be registered as a second home and putting a huge council tax premium on it – despite the fact the cabin was built by the property’s previous owners 25 years ago.

Woodpecker Lodge (Image: Matt Jones)

Hazel says the extortionate costs – which could increase by 300 per cent next year – leave her with no choice but to demolish the cabin when the current season ends, in October.

Hazel said her dream started to unravel in March 2020 following a neighbour’s complaint, over lights being on in the cabin, which resulted in a visit from a valuation officer.

“In lockdown we had a visit from an inspector because of a neighbour complaint that they’d seen a light on and wondered if someone was living in the cabin,” said Hazel.

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“Nobody’s living in it. We opened it up as it was covered by trees but people think we’ve built a cabin when we haven’t.

“We asked the inspector if we had to pay any tax but he said no; we’ve even got a letter saying there’d be no further action taken and no charges to pay, but then a month later I got a council tax bill from Powys.

“The cabin was already here, it has been for 25 years. It is the same shape. All we’ve done is painted, carpeted and set it out like it is, we’ve done nothing structural to it.

“It was used as an office by the previous owners, they didn’t have planning permission for it. It’s even on our house deeds.”

The couple have spent three years arguing the case, and Hazel says it is an extension to the home and is even attached to their water and electricity. It has never had council tax charged against it before.

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She says the cabin, which is no bigger than a standard garage, cannot be considered a second home because there aren't enough facilities inside. It has a bathroom, bedroom and lounge with tea and coffee making facilities.

Richard bemoaned the fact that part of the criteria for taxing a property says it must have a food preparation area.

“But there isn’t one,” he said. “There’s not even a microwave. Just a kettle and a tea station.”

Though new to the Powys area, Hazel, 60, has called Wales home for the last 40 years, having lived in the Abergavenny area, where Richard is from. Another of Hazel’s daughters lives in Erwood.

Hazel paid the council tax bill for the first year, but the added premium is causing a headache.

She added: “We thought ‘OK, we’ve got to pay it and it was alright’, but then this year they put a 75 per cent premium on it and next year it’s going up 300 per cent.

“We’re banded in category A, which was £1,100. The 75 per cent premium means that has jumped to £2,500 this year, but next year it will be nearly £9,000.

“I don’t earn £9,000 on the cabin, it doesn’t earn enough so it doesn’t warrant having it open.

“We’ll see out this season but if we don’t get any answers it has to come down, we’ll demolish it. We won’t have a choice.

“We love Wales and wouldn’t want to be anywhere else. This is home. But, at the moment, we don’t see a future beyond October.”

Since 2017 local authorities in Wales have been able to charge a premium of up to 100 per cent of the standard rate of council tax on second homes, designed to prevent second home-owners taking over Wales’ top visitor spots.

But under new criteria councils will have the power to increase that to 300 per cent. The £9,000 bill would make it more expensive than the council tax bill they pay for the 11-room family home.

Supporters of the Wales-only measure say it is crucial to quelling soaring house prices and lack of housing availability, but others fear it will cripple Wales' tourism economy.

A spokesperson for Powys County Council said: “The Valuation Office Agency (VOA) will decide if a property is classified as a commercial property or a domestic property.

Inside Woodpecker Lodge (Image: Matt Jones)

“For a self-catering unit to be classified as a commercial property, from April 1, 2023, the property must: in the previous 12 months been available for letting commercially as self-catering accommodation for 252 days or more; and during the previous 12-month period been commercially let for at least 182 days.

“Owners who want to challenge the classification of their property would need to contact the VOA.”

A Welsh Government spokeswoman said: “There are a number of exceptions to the premiums and, following consultation, we have recently extended these. Holiday lets captured by one of the exceptions should not be charged a premium."