Council Tax

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    Council Tax

    We are taking T to court for rent arrears, if we win will she be responsible for the council tax up to the end of the tenancy agreement.

    Thanks
    Mr/MrsLandlord

    #2
    Originally posted by Mr/MrsLandlord View Post
    We are taking T to court for rent arrears, if we win will she be responsible for the council tax up to the end of the tenancy agreement. Thanks
    Mr/MrsLandlord
    Council tax is not a contract or AST.
    They pay council tax for the length of time they are in the property, and not
    if they have to pay for a tenancy ( 12 month tenancy, but left after 6 months
    but paid 12 months rent, means they pay council tax for only 6 months.

    Whoever is registered to pay the council tax, is the one that has to pay it,
    so if it's not you, the council will have to go after the tenant for council tax ,
    and does not concern you.
    Unless you are still registered to pay the council, in which case, unless you
    stipulated that the rent included council tax, or an extra payment was
    required, you cant ask for council tax if you are the ones down to pay.

    Comment


      #3
      So if T has 6 month tenancy agreement starting 4th Jan and say's she moved out 4th Mar but there were still large items of furniture left in the property by T, T will not answer letters or texts to discuss ending tenancy so has not signed a surrender form, so she has a legal right to return to property as tenancy agreement doesn't end until July, but is not responsible for for Council Tax, this doesn't seem right or fair. We cannot let property out until T signs a surrender document surely thats correct otherwise T could claim she was illegally evicted.

      Mr/MrsLandlord

      Comment


        #4
        Originally posted by Mr/MrsLandlord View Post
        So if T has 6 month tenancy agreement starting 4th Jan and say's she moved out 4th Mar - this doesn't seem right or fair. Mr/MrsLandlord
        We assume the person moved out and has moved somewhere else.

        Using your dates above, if someone does not live at premises,
        then councl tax is not payable.

        As said, Council tax is not your problem. It's between one person and the
        Council.
        Normaly If the person has indeed left your property, they will will be paying
        ( or should do, ) council tax elsewhere, No one wants to pay 2 council taxes.

        But once you know where he/she have moved to, you can tell the council
        when she left your place, and the council wll persue her.

        Comment


          #5
          I think what O/P is saying is that O/P seems to be responsible for council tax because tenant has left furniture there. They dare not remove it or change locks until they have a court order, which may take some months.

          Presumably tenant has told council that they have moved out. Will the council say that council tax is payable by O/P now, or from the date of the possession order? I guess this could also be a problem for anyone letting a flat furnished?

          If the council starts asking Landlord for council tax, is that a safe ground for Landlord to enter and re-let the property?

          Comment


            #6
            Originally posted by JK0 View Post
            I think what O/P is saying is that O/P seems to be responsible for council tax because tenant has left furniture there.
            Normally there is a 6-month exemption on vacant properties provided they are unfurnished, so providing that is the case, the OP can simply register the property as such with the council. If there's simply a few items of the tenant's furniture remaining, that shouldn't affect the situation: the point is that property remains demonstrably uninhabitable. In my experience council tax official tend to peer through windows to verify unfurnished status so it's probably prudent to ensure any visible rooms are 100% empty for the avoidance of doubt.

            If the tenant has left so many items of furniture behinf that it's not possible for the landlord to claim the 'vacant' exemption, that I'd have thought it's self-evident that the tenant is liable for the council tax.

            Comment


              #7
              Originally posted by Ericthelobster View Post
              I'd have thought it's self-evident that the tenant is liable for the council tax.
              It's not evident.
              If you look at the list of precedence in liability, if there is no resident the owner is liable.
              So to me that means that in principle the tenant's liability for council tax could stop even if tenancy does not...

              Comment


                #8
                Originally posted by jjlandlord View Post
                ...........So to me that means that in principle the tenant's liability for council tax could stop even if tenancy does not...
                .. agreed,and also if the occupation ceases (moves to another property but large items left behind..)
                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


                  #9
                  Originally posted by theartfullodger View Post
                  .. argeed,and also if the occupation ceases (moves to another property but large items left behind..)
                  Yes, exactly!

                  Comment


                    #10
                    A very complicated area of law but I would disagree with the premise that a person has to be resident at the property to be liable for Council Tax.

                    The reasoning behind this lies in a recent LG Ombudsman decision which my colleague won against Leeds City Council on such a point in the last few months.

                    Brief History

                    Tenant had a six month fixed term. The tenancy became monthly SPT and the tenant gave notice to vacate property. Tenant physcially left property but 6 weeks still remained of his notice. The tenant moved into a new property and paid council tax on that property to Leeds City Council (LCC). LCC chased the landlord of the first property for Council Tax but also for the period from when the tenant physically left the property until the tenant notice expired.

                    The landlord appealed against LCC stance with help from my colleague via the LG ombudsman and won. The council were ordered to chase the tenant for the Council Tax due for the remaining period of his notice.

                    I am not at work, so dont have all the facts of the case to hand, but you need to examine in detail the following act to see the reasoning for the appeal.

                    http://www.legislation.gov.uk/ukpga/1992/14/section/6

                    My colleague is pretty knowledgeable in this area as he is the same person who won the right for landlords to request direct payments of LHA when it became contractually due rather than when HB deemed it to be due. (8 week rule)

                    PM if you want more details of this Council Tax case.

                    Comment


                      #11
                      Thanks Pete.

                      I still have one question. Say the tenant leaves a furnished property after the fixed period, and stops paying rent but does not return keys. The landlord then has to issue a section 8 once two months rent is owing or possibly a section 21.

                      Would the tenant have to pay council tax until the landlord obtains a possession order?

                      Comment


                        #12
                        Thanks indeed, Pete.

                        The statute mentioned does say that it is first the resident who is liable, then the owner.
                        It's difficult to guess, but I'm thinking that, perhaps, the decision in appeal was based on interpreting that, as the tenancy had not ended, the tenant had an higher interest in the property than than the actual owner and should therefore be liable. Which makes sense, imo.

                        Comment


                          #13
                          Originally posted by JK0 View Post
                          I still have one question. Say the tenant leaves a furnished property after the fixed period, and stops paying rent but does not return keys.
                          I think that whether possession proceedings are needed would depend on whether the tenancy is continuing.
                          If T has vacated by end of fixed term and stopped paying rent it's quite arguable that the tenancy has ended.

                          As per above, if tenancy has ended and T has vacated, certainly he is no longer liable for CT.

                          Comment


                            #14
                            Originally posted by jjlandlord View Post
                            I think that whether possession proceedings are needed would depend on whether the tenancy is continuing.
                            If T has vacated by end of fixed term and stopped paying rent it's quite arguable that the tenancy has ended.

                            As per above, if tenancy has ended and T has vacated, certainly he is no longer liable for CT.
                            No, no, sorry I meant if the tenancy had gone into a periodic one.

                            Would the landlord have to start paying council tax while he was still waiting to regain possession of his property? (The notice period Pete mentioned was six weeks, but I think the law says the tenant has to give a month. Either way, I doubt possession hearing would be that quick.)

                            Comment


                              #15
                              A bit more information on the case plus the panels decision and reasoning.

                              THE HEARING

                              At the first stage of the appeal (which is basically a letter to the local authority) the local authority’s argument was that because the tenant had ceased to occupy as their only or principle home, the tenancy could no longer be an assured shorthold tenancy (which is true) and that the whole tenancy therefore came to an end from 20 August (which is untrue) and so there was no material interest. In fairness to the local authority, this argument was swiftly dropped!

                              For the main appeal at the tribunal, the authority’s primary case was that when the fixed term tenancy came to an end on 22 July 2009, a statutory periodic tenancy took effect on 23 July 2009 (see s.5 Housing Act 1988). As this statutory periodic tenancy was a new tenancy, it was NOT granted for a period of six months or more and therefore was not a “material interest” as defined by the regulations. Then, on 20 August 2010 when the tenant ceased to occupy, the tenancy became a contractual tenancy and again as this new tenancy was not granted for a term of six months or more, it was not a material interest as defined by the regulations.

                              To summarise the situation, the billing authority stated that, in its opinion, the tenant had had three different tenancies at the appeal property rather than the second and third being a continuation of the first and, as the third was not a material interest, then it was the owner, not the tenant who was liable for council tax purposes. [para 3 of the decision]

                              We argued that a statutory periodic tenancy is “an entitlement to remain” and therefore a continuation of the six month fixed term. In addition, material interest is defined as a leasehold interest which “was” granted for a term of six months or more (therefore granted at some point in the past) and therefore it must have been intended by the legislator to apply to a periodic tenancy that arises from a tenancy that “was” previously for a term of six months or more.

                              We also argued that when the contractual tenancy arose as a result of the tenant ceasing to occupy as his only or principle home, although accepting it ceased to be an assured shorthold tenancy at this time, it had simply drifted into being a contractual tenancy and was not a new granting of a new tenancy.

                              THE DECISION

                              The panel was of the opinion that in the event of any dispute between the landlord and tenant following the commencement of the original tenancy on 23 January 2009, then the aggrieved party would have been able to take action based on the clauses within that tenancy agreement, even after the expiration of the initial six month period. Consequently, the panel concluded that the original tenancy agreement remained in force and was legally binding up to the date when then tenant ended the agreement on 22 September 2010. This suggested clearly to the panel that the three periods referred to by the billing authority were a continuation of the original agreement and not three separate and different agreements and it therefore followed that the tenant had a material interest in accordance with section 6 of the Local Government Finance Act up until 22 September 2010. In deciding this particular aspect of the appeal, the panel also considered the view of a “reasonable onlooker” and concluded that they would also arrive at the same conclusion.



                              Having decided that the tenant had a material interest in the property for the period in dispute, the panel considered the definition of owner in respect of section 6 and concluded that, as the tenant had a material interest which was inferior to that of the freehold owner’s, then the freehold owner could not be regarded as owner for the purposes of section 6. With regards to the tenant, there was no other material interest inferior to his and it was he, therefore, who met the definition of owner.



                              It was not disputed that the sole or main residence of the tenant changed when he occupied the property which he had purchased, but the sole or main residence of a person did not preclude that person from also being liable for council tax at another address. Consequently, it was possible for the tenant to be liable for council tax purposes at both addresses, even though he only resided in one of them.

                              Comment

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