Cardiff's visitor levy is already on next summer's trips

Hotel rooms in Cardiff booked on or after 28 September 2026, for nights from 1 April 2027, carry a visitor levy of £1.30 for each guest for each night. Children and babies count. A London agency selling a coach trip to a Cardiff concert next summer is buying rooms that already carry the levy, whether or not the hotel has mentioned it yet.

How the Welsh levy works

The Visitor Accommodation (Register and Levy) Etc. (Wales) Act 2025 sets two rates. The lower rate, 75p, is for adults in a tent on a camping pitch or in a shared room in a hostel; under-18s there pay nothing. The higher rate, £1.30, applies to guests of all ages in hotels, guest houses, holiday lets and most other accommodation. It is a charge per person per night, not a percentage of the room price, so a family of four in one room pays four times the levy a single traveller does.

Each council chooses whether to charge it. Cardiff is the first, and at the time of writing the only council on the Welsh Revenue Authority's list. A council must announce a levy a year ahead and can start one only on 1 April or 1 October, so any other council's levy will be visible well in advance.

The accommodation provider is the one liable. The Welsh Revenue Authority's guidance says that from 28 September 2026 a Cardiff provider must account for the levy on new bookings for stays from 1 April 2027, and on nights or guests added to older bookings. It must pay even if a guest refuses, and it can absorb the cost, raise its prices or add a separate levy fee.

Separately, every provider of overnight accommodation in Wales must join a new national register, open since 1 October 2026, by 31 March 2027, whether or not its council charges a levy. That duty falls on the hotels and holiday lets themselves. An agency that resells their rooms is not normally the one that registers.

The VAT on top

The Welsh Revenue Authority's guidance on VAT and the levy, published on 15 September, says that for a VAT-registered provider "VAT applies to the total amount guests pay for their stay. This includes Visitor Levy if you pass its costs on to your guests." So a hotel that passes on £1.30 will usually charge 26p of VAT with it.

For an agency that resells the room in its own name, that VAT is a cost. Under the Tour Operators' Margin Scheme, HMRC's notice for tour operators says you cannot reclaim VAT on travel services you buy in and resell. The agency pays £1.56 per person per night. Margin on a trip within the UK is standard-rated, though, so anything the agency absorbs also lowers the VAT it owes on its margin by a sixth.

What it looks like on one trip

Illustration, not a real client. An agency in Wood Green sells a coach trip for 40 people to a stadium concert in Cardiff in June 2027, with two nights in a city-centre hotel. It sold the trip in October 2026 at £289 a head, £11,560 in all, priced from a hotel quote that did not show the levy. When the contract arrives, the hotel adds the levy as a separate fee, with VAT.

• The levy: 40 guests, 2 nights, £1.30 each, which is £104.

• The VAT on it: £20.80, which the agency cannot reclaim. Its cost rises by £124.80.

• The margin scheme: the agency's margin falls by £124.80, so the VAT it owes on that margin falls by a sixth of that, £20.80.

• The net cost is £104, the levy itself.

The two lots of VAT cancel out here because the trip is in the UK. On a coach of 40 the cost is small. Spread across a summer of Cardiff weekends priced without it, it is a margin that was never there. Our page on how VAT works for a travel agency selling in its own name explains why the margin is the figure to watch.

What to do this month

1. Ask each Cardiff hotel how it will charge the levy to you: inside the room rate or as a separate fee, and whether VAT is added.

2. Price £1.30 per person per night, plus VAT where the hotel adds it, into every Cardiff stay from 1 April 2027 that you have not sold yet.

3. For trips already sold, read your booking terms before relying on a surcharge. A price rise after booking is allowed only where the contract provides for it.

4. Watch the Welsh Revenue Authority's list of councils charging the levy. A year's notice means the next one will not arrive by surprise.

For an agency that priced next summer without it, the cost is £1.30 for every Cardiff guest-night it has sold on rooms booked since 28 September.

About the author

Harvey Dhillon is the founder and CEO of Zmartly, a UK accountancy firm for small businesses. He grew up in West London and began his career in investment banking finance at Barclays, before going full-time on Zmartly in 2020. He is a Chartered Management Accountant (ACMA, CGMA).

Featured photo by Mike Erskine on Unsplash.