Tenancy renewal - no interim Council Tax liability?

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    Tenancy renewal - no interim Council Tax liability?

    I understand that the Landlord is liable for Council Tax on the last day of a tenancy, even if a new tenancy commences the following day, because it is deemed that someone other that the outgoing or incoming Tenants could potentially stay in the property overnight (which is spurious and improbable).

    I have just received a demand for one day's Council Tax based on this premise. However, this particular instance raises the question of whether the adopted practice could also be applied to the last day of all tenancies, even if they renew.

    My property was occupied by two joint Tenants until one moved out on 10/11/2018 and the remaining Tenant started a new tenancy on her own from 11/11/2018. Therefore the Local Authority sent me a bill for the last day of the old tenancy. Actually, I think the bill is written incorrectly, because it states that my liability is from 10/11/2018 to 10/11/2018, instead of 10/11/2018 to 11/11/2018. Of course, when I suggested to the LA that there should be no interim bill, since the Tenant was living at the property throughout the period, they disagreed. From their point of view, they have correctly charged the full rate while two adults occupied the property and then applied a new discounted rate for the single occupant, which commenced the day after the second Tenant left, and I am liable for the last day of that tenancy.

    So is this actually correct, assuming that the remaining Tenant has legally enjoyed uninterrupted occupation of the property throughout this period? If this is indeed the case, then does it also follow that any tenancy renewal should trigger a chargeable event for the Landlord? The LA is not privy to the length of tenancies enjoyed by their Taxpayers, so presumably the Landlord would then have to inform the Authorities whenever his Tenants renewed their tenancies.

    Is there a clear ruling on this, or is it just ridiculous?


    #2
    It is just ridiculous. It's just jobsworths sticking to a procedure to keep themselves in work. I've had similar. As it was only £3 or something, I took a perverse delight in sending them a cheque for that amount.

    Comment


      #3
      See Local Govt Finance Act 1992 s(2)
      http://www.legislation.gov.uk/ukpga/1992/14/section/2

      Problem is "The Tenant" has changed. 1st tenancy "The tenant" was the two of them, 2nd tenancy just one human. Suspect council are correct, it might be worth a brief email querying it with confirmation from remaining tenant that THEY were in occupation but why spend a load of effort on just one day's Council tax?


      NB Sincerely hope you returned deposit, less deductions to the original joint tenants, did check-out & -in reports & photos, took new deposit, protected it (old protection doesn't apply..) and ALL the other paperwork including PI, EPC, GSC & did "Right 2 rent" checks.
      I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

      Comment


        #4
        Can't possibly be correct. There's clearly a resident for the purpose of council tax throughout, so the non-resident landlord with the superior interest never comes into it.
        I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

        I do not answer questions through private messages which should be posted publicly on the forum.

        Comment


          #5
          I assume that if the tenant moves out of one property and into another during the last day then they switch their CT liability to the new property. I'm guessing that the relevant line in the Act is:

          it shall be assumed that any state of affairs subsisting at the end of the day had subsisted throughout the day.

          Comment


            #6
            It's the lovely legal midnight sequence of events.

            At midnight, the first tenancy ends.
            The landlord is then liable for the council tax because at the end of that day the previous interest holder isn't residing in the property.
            At midnight the next tenancy also began.
            The new tenant is now liable for the council tax at the end of the first day.

            The landlord picks up the day's liability because that sequence follows.
            The new tenancy can't start before the other one ends (the end is at midnight, so the start must be at a later point of midnight).
            So in the interim, the end of the day must happen so the landlord is liable.

            If the end of the day happened at the start of midnight, the exiting tenant would always be liable, because the end of the day would precede midnight when the tenancy ends.

            The person who is the remaining tenant sleeps through this, never having left.

            Reasons to love the law #3

            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

            Comment


              #7
              Originally posted by theartfullodger View Post
              See Local Govt Finance Act 1992 s(2)
              http://www.legislation.gov.uk/ukpga/1992/14/section/2

              Problem is "The Tenant" has changed. 1st tenancy "The tenant" was the two of them, 2nd tenancy just one human. Suspect council are correct, it might be worth a brief email querying it with confirmation from remaining tenant that THEY were in occupation but why spend a load of effort on just one day's Council tax?


              NB Sincerely hope you returned deposit, less deductions to the original joint tenants, did check-out & -in reports & photos, took new deposit, pr

              Regardless of whether the Tenant or tenancy has changed, there was still a Tenant living in the property at the end of the day, so I believe they are the liable person. I think the same ruling must therefore apply when a Tenant renews their tenancy, but the Council don't send the Landlord a bill for one day when a tenancy renews.

              Yes, I made a point of completely ending the first tenancy and commencing a new one, with all the paperwork,etc.....

              Comment


                #8
                Originally posted by jpkeates View Post
                It's the lovely legal midnight sequence of events.

                At midnight, the first tenancy ends.
                The landlord is then liable for the council tax because at the end of that day the previous interest holder isn't residing in the property.
                At midnight the next tenancy also began.
                The new tenant is now liable for the council tax at the end of the first day.
                At midnight, the first tenancy ends and the new tenancy begins, simple as that. There is no interim period at all. Surely, this is how all renewals work. An insurance renewal comes into effect when the old policy expires, commonly at the stroke of midnight - one policy lapses at midnight and the new one commences seamlessly after that. Liability is determined to the exact second.

                Comment


                  #9
                  I did already answered the question for OP's case.... but let me expand on it.

                  What you are interested is s6 of the Local Government Finance Act 1992 as amended. Ignoring things like council tax HMO, subsection (2) set out who is liable for to pay council tax for a chargeable dwelling. Whoever is highest on that list is the one liable, jointly and severally if there are more than one person on the same level.

                  The OP, being non-resident, is bottom of the list in (f). So if there's anyone that qualify higher on the list, the OP cannot be liable. Regardless of what time the first tenancy ended or the second tenancy started, the remaining tenant was a resident throughout. That would be the case even if she was not legally a tenant, jointly or otherwise, at the important moment in time. It may be that for the important moment in time she was a resident with a leasehold interest along with the other joint tenant from the first tenancy, which would place them in (b), or she's in (b) as a sole resident with a leasehold interest under the second tenancy, or no tenancy existed at the important moment in time (which I cannot possibly agree with but hey ho) in which case the lowest she can be placed is (e).

                  In any of the possible scenario, the remaining tenant always place higher than the OP. Whether she's liable for the discounted amount as a resident, or whether she's liable jointly and severally with the former joint tenant for the full amount is something you can leave for them and the council to argue it out if they want but as far as the OP is concerned, the OP is not liable for that day.
                  I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                  I do not answer questions through private messages which should be posted publicly on the forum.

                  Comment


                    #10
                    Thank you KTC. That does seem like the correct and logical conclusion.

                    In that case, how is it that all three of the LAs that I deal with, consistently apply the wrong interpretation and get away with it? They all deem that the Landlord is liable for the last day of a tenancy, because the property is presumed to have been vacated before the evening, leaving it available for occupancy overnight.

                    Comment


                      #11
                      Just to add, I'm not concerned about paying a small charge, but I am constantly riled by the Local Authority's insistence on wasting their funds policing trivial issues with little people, instead of focusing on real objectives.

                      They seem to like referring to the book, but are not good at interpreting it. The Council Tax manual needs to address scenarios like this specifically.

                      Comment


                        #12
                        Originally posted by bagus View Post
                        In that case, how is it that all three of the LAs that I deal with, consistently apply the wrong interpretation and get away with it? They all deem that the Landlord is liable for the last day of a tenancy, because the property is presumed to have been vacated before the evening, leaving it available for occupancy overnight.
                        Your original question, and my answer relates strictly to the case you set out. That is, where there was a tenancy with two joint tenants, and then a sole tenant (being one of the joint tenant) on a new tenancy the next day, where she remained in residence throughout.

                        An answer to the more general question of who is liable for council tax on the last day of a tenancy where the tenant moves out on or before that date depends on how that tenancy ends thus determining whether the tenancy ended on the end of the day or earlier, and whether the tenancy in question constitute a material interest for the purpose of council tax.
                        I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                        I do not answer questions through private messages which should be posted publicly on the forum.

                        Comment


                          #13
                          Originally posted by bagus View Post
                          I'm not concerned about paying a small charge
                          That ^ answer this ->

                          and get away with it?
                          I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                          I do not answer questions through private messages which should be posted publicly on the forum.

                          Comment


                            #14

                            In answer to the original question, KTC referred to the hierarchy of liability, as detailed in Section 6 of the Local Government Finance Act 1992. Why doesn't this then persist in determining the liability at the end of all assured tenancies, if the Tenant is entitled to remain in the property until midnight on the last day of the tenancy? Surely, the Tenant falls into category 2b until midnight.

                            Also, Section 2 (2) "state of affairs subsisting at the end of the day had subsisted throughout the day" is satisfied, since nobody else has a right to occupy the property until after the end of the day.

                            Comment


                              #15
                              Because

                              “resident”, in relation to any dwelling, means an individual who has attained the age of 18 years and has his sole or main residence in the dwelling.
                              “material interest” means a freehold interest or a leasehold interest which was granted for a term of six months or more;
                              If the tenancy in question is a statutory periodic tenancy or a contractual periodic tenancy from the start with no initial definite term, then the tenant does not have a material interest. And if they have moved out, then they're no longer a resident. So come the end of the day, the liable person is the "owner of the dwelling".
                              I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                              I do not answer questions through private messages which should be posted publicly on the forum.

                              Comment

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