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Simple Guide to Council Tax Liability

Each unit of accommodation will have its own council tax banding and this is assessed from time to time by the Valuation Office Agency (VOA) rather than the local council. Units of accommodation come in various shapes and sizes, it may be a house, bungalow, flat or bedsit. Where a number of bedsits or rooms are occupied in the one house such as a House of Multiple Occupation (HMO), then a single banding will usually be applied and the landlord will be billed for the council tax. In such cases the landlord should make provision for this charge when setting the rent. However, the Valuation Office Agency (VOA) is coming under increasing pressure to give bedsits their own banding by some councils.

The council tax liability rests with the person who is responsible for paying the bill. This responsibility is determined by the council on what is known as a "hierarchy of liability", in other words, a pecking order which starts with the resident and ends with the owner or landlord. For council tax purposes the resident must be aged 18 or over.

It follows that landlords should only offer tenancies to people aged 18 or over.

If two people are liable for council tax, as joint tenants for instance, then they will be "jointly and severally" liable for the council tax, meaning both will be pursued for the full debt.

Where a property is unoccupied and no tenancy exists, the landlord will be billed for the council tax. Some councils previously made an allowance for a period of un-occupancy where they would only charge 50% of the full cost. Increasingly however, as councils become more concerned at the number of empty properties in their borough, they are applying the full charge or in some cases even 150% of the standard council tax charge. Some councils are now charging for short periods between tenancies, even overnight in some cases. Needless to say, landlords should be aware of what their local councils are charging and need to plan for this in their forward financial planning.

It is important that landlords offer a written tenancy agreement to a prospective tenant as this will help to convince the council that the tenant is responsible for the council tax whilst they are in occupation. A landlord may however be held liable for the council tax if the tenancy has not been surrendered. This kind of situation often leads to disputes between councils and landlords. Typically, a tenant might move without giving notice to their landlord and the landlord has to apply to the county court for vacant possession of the property. In these circumstances the landlord can be billed for the council tax. An appeal may be lodged with the council but the outcome will invariably end with the landlord paying the disputed charge. It should be borne in mind that councils act very quickly to take people to court to recover unpaid council tax charges, even those charges in dispute.

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