Council Tax liability for landlords can be a confusing issue however there are a few simple considerations which can ensure that the Council Tax liability has been correctly determined and you are not caught out with any large, backdated, Council Tax demand.
What is Council Tax liability ?
Liability is the term used to describe who is responsible for the Council Tax bill on any particular property – there may or may not be any actual charge for you to pay. More than one person may be liable for a Council Tax charge at any one time, especially if there are joint owners of the property.
When is a landlord liable for the Council Tax charge ?
Council Tax liability is determined, primarily, under Section 6 of the Local Government Finance Act 1992. This sets out, in law, who is responsible for the Council Tax account for the property. The Local Authority have no discretion over following and applying this legislation.
In most cases, for occupied properties, the resident tenants or owners are jointly responsible (including partners in some cases) for the Council Tax charge whilst the landlord is primarily responsible for the Council Tax charge whilst the property is not occupied.
There are some special cases where a tenancy agreement for a period of less than 6 months can exist and this may mean that the landlord can fall liable for the Council Tax charge. This would most commonly occur, but not exclusively, in cases which fall under the situation which occurred in the Leeds v Broadley case.
Special rules also apply in some specific cases and in these case, under Section 8 of the Local Government Finance Act 1992, the landlord remains liable for the Council Tax charge – the most common of these situations is that of a Houses in Multiple Occupation (HMO). In these specified cases the landlord cannot assign the Council Tax liability to the occupiers although they can re-charge the amount to them via a rental agreement.
Can a landlord specifically determine Council Tax liability ?
The Council Tax liability for a property is determined solely with reference to Council Tax legislation and is, primarily, based on the type of tenancy agreement. Any terms which try to alter who is liable for Council Tax payment are not generally enforceable under Council Tax legislation (although they may be via a Civil Court case between you and the landlord).
Is a landlord be responsible for a tenant’s Council Tax liability ?
Not directly. As the Council Tax liability on a property is determined solely by Council Tax legislation and based on the type of tenancy agreement then a landlord cannot be held responsible for any Council Tax charge which should be in a tenant’s name. The landlord is only responsible where Council Tax legislation provides for it to be the case. If an incorrect liability is found at a later date the Local Authority can amend their records retrospectively and issue backdated demand notices.
Can an agreement with the landlord determine Council Tax liability ?
No. Council Tax liability is determined solely by Council Tax legislation and based on the type of tenancy agreement. Any terms which try to split or determine liability and who is going to pay the Council Tax are not enforceable in Council Tax legislation (although may be enforceable via a Civil Court case between you and the tenants). If an incorrect liability is found at a later date the Local Authority can amend their records retrospectively and issue backdated demand notices.
Tenants have left the property, what happens to the Council Tax ?
If tenants have vacated a property then special attention should be paid to the recent clarification of liability in the Appeals Court Case of Leeds CC v Broadley. Just because they’ve vacated does not mean that they cease being liable for the Council Tax payments nor does simply holding a tenancy mean you they remain liable after vacation. Care should be taken to determine the exact situation.
Advice & Assistance from LGFA92
Good quality help with your Council Tax dispute can be hard to come across – there’s a lack of independent, expert, places where you can get the help you need however LGFA92’s Council Tax paralegal is here to change that.
This website is solely the view of LGFA92, the Council Tax specialists , 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.