Door opening on new licensing scheme for short term lets - Kevin Clancy

A new licensing scheme is coming into force in Scotland to regulate short-term lets. It requires hosts of self-catering accommodation to have a licence to accept bookings and welcome guests.

Do I need a licence?

The scheme applies across Scotland, though some residential accommodation is specifically excluded (such as hotels, hostels and caravan sites), as are certain types of tenancy arrangements. For the purposes of the scheme, a short-term let is defined as the use of residential accommodation provided by a host in the course of business to a guest, where all the following criteria are met: The guest does not use the accommodation as their only or principal home; The short-term let is entered into for commercial consideration; The guest is not an immediate family member of the host, sharing the accommodation with the host for education purposes, or owner/part-owner; The accommodation is not provided for the principal purpose of facilitating the provision of work or services by the guest to the host (or another member of the host’s household); The accommodation is not excluded accommodation; and The short-term let does not constitute an excluded tenancy.

When is the deadline?

Kevin Clancy is Partner, Shepherd and WedderburnKevin Clancy is Partner, Shepherd and Wedderburn
Kevin Clancy is Partner, Shepherd and Wedderburn

From 1 October, new hosts wishing to let their property for the first time must have a licence in place before taking bookings and receiving guests.

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Existing hosts (those with a property previously used by guests on a short-term basis) have until 1 April 2023 to submit an application to the relevant local authority. If the application is refused, the host must stop operating within 28 days.

If an existing host hasn’t submitted a licence application by 1 April 2023, they cannot take bookings or receive guests until the licence has been granted.

By 1 July 2024, all hosts must have a licence to take bookings and receive guests.

How do I apply?

There are four types of licences:

Licence for home sharing (letting out part of your home to a guest who occupies the property along with you); Licence for home letting (letting out your entire home while you aren’t occupying it); Licence for home sharing and home letting (a combination of above); Licence for secondary letting (an additional property let out to guests).

You must apply via the relevant local authority, providing information about the property, the people letting it out, and details about the property’s safety compliance. Most local authorities are yet to release the finer details of their application system, and each will have slightly different fees and requirements. However, all schemes will be open to applications by 1 October.

If you have multiple properties, you will be required to submit an application for each to the relevant local authority.

You may also need to think about whether planning permission is required for your property.

At the same time as lodging the application form, you will be under an obligation to display what is called a Site Notice on or near the property, giving notice to neighbours that an application has been made. It must be on display for 21 days, and there is a period of 28 days within which objections to the application may be lodged. Thereafter, the local authority licensing committee will determine whether to grant the application.

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Where a licence is required, it is a criminal offence for a host to operate without one, so obtaining a licence in good time is important.

Kevin Clancy is Partner, Shepherd and Wedderburn


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