Council Tax can be expensive so as a landlord it is in your best interests to ensure that the Council Tax liability is correct.
Is the landlord always responsible for Council Tax ?
Generally speaking the resident tenant of a non-HMO property will be held responsible for the Council Tax charge on the property without any issues, this is because the residency of the property makes then responsible for the Council Tax charge under s6 of the Local Government Finance Act 1992. This is the best case scenario, where a tenant is resident in the property, however where your tenant is not resident in the property then the game changes.
Where a tenant is not resident in a property then Council Tax legislation instead will look to the Council Tax definition of ‘owner’ to determine who is responsible for the Council Tax charge. It is at this point that the perverse effect of legislation can make a tenant liable for the rent payments yet not responsible for the Council Tax charge – where the tenant is not responsible for the Council Tax charge then the landlord is likely to be the one who is liable for it instead (see Leeds City Council v Broadley for one example).
Special cases where landlords will always pay the Council tax
Council Tax legislation provides for specific situations, most commonly for HMO’s, where the landlord will always remain liable for the Council Tax charge. In these cases the landlord cannot choose to make the tenants liable for the Council Tax charge, instead the landlord will be billed by the local authority and will need to collect any monies by recharging the tenants.
Are landlords responsible for a tenant’s unpaid Council Tax ?
As a landlord you’re only responsible for paying the Council Tax charge which is legally yours to pay – even if you agree to pay for the tenant this is purely a personal agreement with the tenant and the local authority will issue the demand notice. LGFA92’s advisor has come across cases where the landlord has been wrongly pursued for unpaid Council Tax and in these cases we would suggest you contact us for our assistance as soon as possible.
It’s always best for a landlord to make sure that they have a written tenancy agreement as far as possible and to ensure that they keep any applicable records which could be used to assist in any disputes which may occur. Most issues for landlords can be resolved by ensuring that the local authority is always kept up to date with the correct information. LGFA92 would not recommend leaving it to the tenants to update the local authority in respect of Council Tax.
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This article is solely the view of LGFA92, the Council Tax agents and experts, based on our interpretation of legislation. Your local authority is free to dispute this view. A binding decision may require the intervention of a valuation tribunal.