Most landlords who let a property that is tenanted will not be liable for council tax. This is because where a property is occupied by a tenant; it’s the tenants who are responsible for meeting the costs of the council tax charge.
However, when a property is vacant many landlords will have to prove this by way of a tenancy agreement and if the property is furnished or unfurnished, by way of an inventory or check out report. Many councils now demand this before they will grant exemptions.
If the property is furnished, the landlord will only enjoy 10% relief on the council tax due, proportionate to the time it is vacant.
All home are given a council tax valuation band by the Valuation Office Agency (VOA). The band is based on the value of your home on 1 April 1991. A different amount of council tax is charged on each band. Each local authority keeps a list of all the domestic property in its area, together with its valuation band. This is called the valuation list.
The valuation bands are:
Range of values
|A||Up to £40,000|
|B||Over £40,000 and up to £52,000|
|C||Over £52,000 and up to £68,000|
|D||Over £68,000 and up to £88,000|
|E||Over £88,000 and up to £120,000|
|F||Over £120,000 and up to £160,000|
|G||Over £160,000 and up to £320,000|
Some property is exempt from council tax altogether. It may be exempt for only a short period, for example, six months, or indefinitely.
Properties which may be exempt include:
Usually one person, called the liable person, is liable to pay council tax. Nobody under the age of 18 can be a liable person. Couples living together will both be jointly and severally liable, even if there is only one name on the bill. This applies whether the couple is married, cohabiting or in a civil partnership. No one is under an obligation to make a payment until they are issued with a bill in their name or, if they are jointly and severally liable, with a joint taxpayers’ notice.
Usually, the person living in a property will be the liable person, but sometimes it will be the owner of the property who will be liable to pay.
The owner will be liable if:
If only one person lives in a property they will be the liable person. If more than one person lives there, a system called the hierarchy of liability is used to work out who is the liable person. The person at the top, or nearest to the top, of the hierarchy is the liable person. Two people at the same point of the hierarchy will both be liable.
The hierarchy of liability is:
Clearly if your property(s) are managed by DeMachin Ltd, we take care ensuring the right people pay their share. If you are a landlord managing the property yourself, these are the steps we would advise to ensure that you don’t get a letter demanding arrears months or even years down the line.
Contact the relevant council to notify them of a tenancy changeover
All the bills need to be addressed to the landlord and sent to your address NOT the property in question.
If demands are sent to the property, they will lay there unopened until you receive a summons for the amount owed.
As time passes, it will be more and more difficult to prove liability. You will have to prove any one, if not all of the following:
There may be a cross over in liability from the previous tenant to you and this is difficult to prove if they are on a periodic contract or extend their contract by a few weeks. They may be covered by the tenancy agreement but this is why you may be asked for proof of check out reports and security deposits. This information gets archived and mislaid over time and the last thing you want to do is be hauling through boxes of information trying and hoping to find what you need.
Rule of thumb is back up all conversations with the council with a letter summarising actions, dates and which customer advisor you spoke with. Follow this up with a demand for a final bill, which states a zero balance. This is watertight way of ensuring that you never get a nasty shock 6 months down the line.
We see this all the time with all utilities so if you invest a little time now, you will not have spend a lot of time later. Here is an example of what should be in your written correspondence:
Name(s) of outgoing tenants(s): Mr Tenant
Move out Date 01 March 2011
Name(s) of incoming tenants(s): Miss New Tenant
Move in Date 03 March 2011
Logged with your office on, 04/03/2011 with Miss Customer Advisor
Property Status: Unfurnished – exempt
Please forward all correspondence relating to the homeowner/landlord to the following address:
If you need any advice or help, please contact DeMachin Ltd 020 7607 1712 or email at [email protected].