England Landlord Guidance
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1.9 Council Tax
In self-contained flats or houses, the tenant is normally liable for Council Tax. Landlords should inform the Council Tax section of the local authority in writing whenever someone moves in or out of their property, or if it is empty.
If the property is empty, the landlord will normally be liable for Council Tax, but local authorities can offer discounted periods where the property is unoccupied and unfurnished. These discounts (if any) vary between local authorities. For example, some offer one week at 100% discount followed by six months at 40% before the full amount becomes payable. Others offer longer 100% discount periods such as one or three months but on the other hand, some don’t offer any period of discount whatsoever.
Where a property is unoccupied but a tenancy is still ongoing for example as a result of abandonment or, during the period whilst a tenant moves to a new property after giving notice, whether the landlord or tenant remains liable depends on the status of the tenancy whilst the property was unoccupied. Advice should be sought but as a minimum, there must be a tenancy in place which was granted for at least six months and (where the tenancy is beyond the fixed term) has continued as a contractual periodic tenancy for the tenant to be liable in these circumstances.
Where a property is fully occupied by students undertaking full-time education courses, the property becomes exempt from Council Tax, but students have to apply for exemption. Their education institution will be able, on request from the student/s, to provide them with a notice that they are a full-time student and liable for exemption. If their tenancy agreement extends over the summer vacation, the exemption usually covers that period.
Students should be asked to provide proof of study to the landlord, where the landlord is liable for Council Tax. The landlord can then apply to the council for their exemption.
1.9.2 Council Tax HMO
If there is more than one tenancy agreement for the property (e.g. if it is divided into bedsits), the property will be known as an HMO but this should not be confused with the HMO rules landlords are more commonly familiar with (for which see later). Council Tax has separate and entirely different definitions for what is an HMO for Council Tax purposes.
Where the property is regarded as an HMO (for Council Tax purposes) the rules are more complex and will vary depending upon the policy of the council in that area and the layout of the property. Traditionally in a bedsit type property the landlord was responsible for payment of Council Tax and collected this through the rent charged to tenants. Valuation Tribunal rulings have stated that the liability for Council Tax depends upon the location and number of kitchens and not whether it is self-contained. A bedsit with its own kitchen, but sharing a bathroom and WC, may still be rated as an individual unit for Council Tax purposes making the tenant liable for the Council Tax. Whereas a bedsit with an ensuite bathroom, but sharing a kitchen, the liability would lie with the landlord. A bedsit type house with two shared kitchens may be rated for Council Tax purposes as two separate units, three kitchens – three units etc. Some councils still take the traditional view, but more areas are issuing Council Tax demands based on the availability of kitchens and it is important to seek advice from the local Council Tax team.
A property can also be regarded as an HMO for Council Tax purposes even if only ‘part of the building’ is let. For example if a conservatory or loft is excluded from the tenancy. It is also possible for a property to be regarded as an HMO where the dwelling was originally constructed or subsequently adapted for occupation by persons who do not constitute a single household. Therefore, it is even possible that adaptations alone define the property as an HMO for Council Tax. Whether these situations would be defined as an HMO will depend on the individual circumstances.
Where the property is regarded as an HMO (for Council Tax purposes) the landlord will always be liable to pay the Council Tax.
1.9.3 Single Person Discount
A tenant over 18, living alone in a property will qualify for a 25% discount from their Council Tax bill.
1.9.4 Long Term Empty Property
Local authorities may set a Council Tax rate for long-term empty properties of up to 150% of the normal liability. A ‘long-term empty property’ is a property which has been unoccupied and substantially unfurnished for at least two years. This is often called the ‘empty homes premium’.
The empty homes premium cannot apply to homes that are empty due to the occupant living in armed forces accommodation for job-related purposes (Class E); or to annexes being used as part of a main property (Class F).
1.9.5 Major Repairs to Render Habitable
A local authority may offer a discount of up to 100% where a dwelling is vacant and requires, or is, undergoing major repair work to render it habitable, including structural alteration. The amount of the discount (if any) is determined by the local authority and can be for a maximum of 12 months.