London 90-Day Airbnb Rule and Short-Let Regulations 2026

Letting a property short-term in London on platforms like Airbnb can look attractive; but London has some of the UK's strictest rules on this, and the picture tightened further in 2026. This guide explains the famous "90-day rule", the abolition of the holiday-letting tax regime, the new registration scheme, and why all of this steers most foreign investors towards long-term letting.

What Is the London 90-Day Rule?

London's 90-day rule is a law designed to protect housing supply. In Greater London, a residential property cannot be let as "temporary sleeping accommodation" for more than 90 nights in total in a calendar year without planning permission. In law, this rule rests on the Greater London Council (General Powers) Act 1973 and was updated by Section 44 of the Deregulation Act 2015.

To stay lawful without permission, two conditions must be met together: first, the short-term letting total must not exceed 90 nights in the calendar year; second, at least one of the persons providing the accommodation must be liable for Council Tax at the property. This 90-night cap resets each year on 1 January. An important distinction: the cap applies only to entire-home lets; "hosted" (shared) stays where the owner is present in the property do not count towards the 90 nights.

How Is the Rule Enforced, and What Are the Penalties?

Exceeding the 90-night cap is treated as a "material change of use" of the property and requires planning permission from your borough (local council). This permission is not guaranteed; the application usually takes 8-13 weeks, costs a few hundred pounds, and is assessed weighing housing pressure, local saturation and neighbour objections. Central boroughs (Westminster, Camden, RBKC, the City of London) actively enforce this rule.

Let us correct a critical misunderstanding: Airbnb auto-blocks the calendar at 90 nights on its own platform, but that does not fully protect you. Legal responsibility always sits with the host, and nights on other platforms (Booking.com, Vrbo, direct bookings) can push you over the limit. So you must track your total nights across all platforms in one place. In the event of a breach, fines can reach £20,000. Furthermore, the Mayor of London and some boroughs are calling for the cap to be reduced to 30 or 60 nights; while not yet legislated, this shows the direction is towards further tightening.

The Abolition of the FHL (Holiday Letting) Tax Regime

One of the most important fiscal changes of 2026 is the abolition of the Furnished Holiday Lettings (FHL) tax regime on 6 April 2025 (Finance (No. 2) Act 2024). Qualifying holiday lets used to be treated like a "trade" for tax and received advantageous treatment; this has now ended.

The concrete consequences of the abolition are: short-term let income is now taxed like standard property income (the same as long-term letting); mortgage interest is limited to a 20% basic-rate tax credit only (no full relief); capital allowances for new furniture/equipment are no longer available; and the previous CGT reliefs on sale (Business Asset Disposal Relief, rollover, gift relief) have gone — gains are now taxed at standard residential CGT rates (18%/24%). In short, the abolition of the FHL regime has flipped the economics of casual London holiday letting. (For the tax details, be sure to consult a qualified tax adviser.)

The Registration Scheme and Planning (C5)

Another layer is the national registration scheme. The Levelling-Up and Regeneration Act 2023 gave powers for a mandatory registration scheme for all short-term lets in England; this scheme is coming into force over 2025-2026. Under it, every STR property must register and display the registration number it receives on all platform listings; platforms check this number. Unregistered hosts can face fixed penalties (roughly £2,500-£7,500 according to sources).

In parallel, a new "C5" planning use class has been proposed, separating short-term lets from residential; when it comes into force, converting from C3 (residential) to C5 may require planning permission in some areas (watch for Article 4 Directions). Every STR must also meet basic safety obligations: a valid EICR (electrical safety report, every 5 years), a gas safety certificate (where applicable), smoke and carbon monoxide alarms, and fire-safe furniture. In addition, properties that do not qualify for business rates can face a second-home council tax premium of up to 100%.

Optivest Note: This is a topic that touches directly on Optivest's real area of expertise. The picture above — the 90-day cap, the loss of FHL advantages, registration and planning obligations, safety certificates — makes short-term letting in London complex and unpredictable for most foreign investors. By contrast, a well-managed long-term (standard) let is entirely exempt from the 90-day cap, offers more stable income, and carries no per-night regulatory burden. Optivest's property management service runs exactly this long-term letting side; the legal support service supports the legal compliance of letting. Optivest does not provide an Airbnb operating service and does not do tax filing; those are the domain of the platforms and of a qualified tax adviser respectively.

Important notice — not legal/tax advice: This article is for general information only and does not constitute legal or tax advice. Short-term letting rules are actively changing (the registration scheme, C5, a possible reduction in the night cap). Before deciding, check current rules on gov.uk and with your own borough, and consult a qualified legal/tax adviser. Optivest does not provide a tax advisory service.

Frequently Asked Questions

How many days a year is Airbnb legal in London?

In Greater London, you can let an entire home short-term for a maximum of 90 nights in a calendar year without planning permission. To be lawful, at least one of the providers must also be liable for Council Tax at the property. Exceeding 90 requires planning permission, and a breach can carry fines up to £20,000.

If Airbnb auto-stops at 90, is that enough?

No. Airbnb only blocks at 90 on its own platform; nights on Booking.com, Vrbo or direct bookings can push you over the limit, and legal responsibility remains with you. You must track your total nights across all platforms yourself.

The FHL regime was abolished — what does that mean?

From 6 April 2025, the FHL tax regime has gone; short-term let income is now taxed like standard property income. Mortgage interest is limited to a 20% credit, there are no capital allowances on new expenditure, and the previous CGT reliefs on sale (BADR, etc.) have gone. Consult a qualified tax adviser for the details.

What is the registration scheme, and is it mandatory?

A national short-term let registration scheme is coming into force in England; every STR property must register and display its registration number on all listings. Platforms check the number, and unregistered hosts can face fines. Check gov.uk for the current portal.

Why is long-term letting safer?

Long-term (standard) letting is entirely exempt from the 90-day cap, offers more stable and predictable income, and carries no per-night registration/planning burden. The abolition of FHL and the increasing STR regulation have made long-term letting a more practical strategy for most foreign investors.

In Summary, and How to Reach Us

Short-term letting is possible in London but tightly limited: a 90-night cap for an entire home (exceeding it risks planning permission and fines up to £20,000), the loss of FHL tax advantages, the new registration scheme and safety obligations. This picture tilts the maths in favour of long-term letting for most foreign investors: no cap, more stable income, less regulatory burden.

Long-term letting is Optivest's direct area of expertise; we run this process through our property management and legal support services (we do not operate Airbnb or do tax filing). Contact us or reach us on WhatsApp. See our property management service, our legal support service for the legal side of letting, and our project listings for options.