Short Term Let Licences
In Scotland, as of 1 October 2023, you must have a licence before you offer short-term lets. This applies to having paying guests in your property and taking bookings.
Operating without a short-term let licence is a criminal offence. You could be fined up to £2,500 and banned from applying for a licence for a year. You are also unable to offer lets during this period.
The key points to be aware of are that if you rent out a room in your home to a lodger, and it’s their main residence, you won’t need a licence. You also won't need a licence for a typical tenancy if you're a landlord.
Here’s a full guide guide to what’s changed and who’s affected, including:
- Who needs a licence
- Exemptions
- How to apply for a licence
- How much a licence costs
- Qualifying for a licence
Who needs a licence
At this point, the new laws only apply to Scotland. All short-term let accommodation in Scotland needs a licence.
This includes:
- Shared homes
- Rooms within a home
- B&Bs and guesthouses
- Self-catering or holiday lets
- Serviced apartments
There are a few exemptions, including if your guest:
- Lives in the accommodation as their main home
- Is a member of your immediate family
- Uses the accommodation to carry out work or services for you
- Shares the accommodation as part of an educational arrangement
That means if you rent out a room in your home to a lodger, and it’s their main residence, you won’t need a licence.
To find out whether your accommodation needs a licence, you can check here.
How to apply for a licence
If you are an existing host, you should have applied for a licence before 1 October 2023. It’s legal to continue letting in the interim (for up to 12 months) while your licence is processed.
If you’re a new host, you must apply for and get a licence before offering lets. It’s against the law to take bookings or host guests before you have a licence. The council must process your application within 9 months and reach a decision. If they don’t, you’ll automatically get a licence for up to a year.
Your first licence can last up to 3 years from the date it was issued.
How much does a licence cost
Your local council decides the cost of a short-term let licence (including an application fee), which is likely to depend on the property size and type of let. Check your local council's website for information about the cost of the licence.
Qualifying for a licence
The new law requires short-term lets to meet certain conditions to ensure the safety of the accommodation and qualify for a licence. These are also known as ‘mandatory conditions’.
To qualify for a licence for your short-term let, you must:
- Meet the Repairing Standard for houses and flats.
- Hold a valid EPC dated within the last 10 years (where it applies).
- Have fire warning (heat, smoke and carbon monoxide alarms) and records (labels, receipts or photographs) showing furnishings guests have access to meet the Furniture and Furnishings (Fire Safety) Regulations 1988
- Have a Gas Safety Certificate dated in the last 12 months.
- Arrange for a qualified person to carry out an electrical safety check at least every 5 years.
- Arrange for a qualified person to produce a Portable Appliance Testing Report on moveable appliances your guests have access to.
- Meet certain conditions if the accommodation has a private water supply.
- Assess the accommodation's risk from exposure to Legionella.
- Have buildings insurance that is valid for the duration of the licence.
- As a business, you must have public liability insurance that is valid for the duration of each short-term let agreement.
- Make sure the number of guests staying in the accommodation is not more than the number stated on the licence.
- Display information (such as fire safety, copy of your licence), in a place accessible to guests.
- Carry out a fire risk assessment. (Under the fire safety law)
- Have a copy the floor plans for the accommodation for if the council requires an assessment
Local councils can also set extra conditions which they should list on their website.