Council tax and students/professionals

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  • Council tax and students/professionals

    Good morning!


    I am rather new in the 'landlord world' and just have two properties right now.

    One of my properties is vacant. I have a bunch of 3 friends in their mid 20s interested in renting and sharing it.
    2 of them are professionals, the other one is student + part time worker to get herself pocket money.

    What they would like to do is make the student sign the agreement so that they avoid the council tax since the council wont know there are professionals living there.

    I am puzzled about what to do... I would be tempted to accept this as the property will therefore be let this week but I am not quite sure about the consequences for me.


    Any advice on this matter would be really appreciated!
    Thanks
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  • #2
    Shared student/professional house

    As far as I am aware the student exemption only applies if all the occupants of the property are students, even if one isn't then the exemption for the property is null and void.

    I would explain this to the group and tell them that you cannot willingly allow a property that you own to defraud the council.

    You can also write to the council on their behalf explaining that you are the landlord and these are the new residents to whom the bill will be sent.

    I think this a hands on responsible approach to making sure your tenants operate ethically and legally.

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    • #3
      Shared student/professional house

      Saying that you will not allow them to do this shouldn't jeopordise there willingness to sign up and if it did then it is probably a sign that they are willing to cut other corners that will directly affect you in the future!

      Also they have to sign the agreement as group not as one individual.

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      • #4
        This is not an HMO as far as council tax is concerned. The Housing Act 2004 quite clearly states that the definition of HMO applies to that Act only and no other. Therefore the tenants are liable for council tax as long as they are on one AST and jointly and severally liable. It would be different if they had individual ASTs, then the Landlord would be liable.

        If they are all living in the property then all should sign the AST otherwise you may end up with 2 people in your property whom you can't chase for rent.

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        • #5
          Originally posted by attilathelandlord View Post
          This is not an HMO as far as council tax is concerned. The Housing Act 2004 quite clearly states that the definition of HMO applies to that Act only and no other. Therefore the tenants are liable for council tax as long as they are on one AST and jointly and severally liable. It would be different if they had individual ASTs, then the Landlord would be liable.

          If they are all living in the property then all should sign the AST otherwise you may end up with 2 people in your property whom you can't chase for rent.
          Student disregarded for CT liability. If 1 normal person + 1 student occupy, for instance, normal person can claim "sole occupier" 25 % siscount. This would not help when >1 normals co-occupy with 1 student.

          And if you try to conceal all except student, not only might you be guilty of conspiracy to defraud but status of normals would be unclear. They couldn't be tenants if you let to student only.
          JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
          1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
          2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
          3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
          4. *- Contact info: click on my name (blue-highlight link).

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          • #6
            Originally posted by wiregig View Post
            What they would like to do is make the student sign the agreement so that they avoid the council tax since the council wont know there are professionals living there.
            Making the student sign the agreement only makes the student solely responsible for the rent.
            If the other two were not to pay their share, do you think a student would be able to cover the rent? Would you actually let the property to a student alone which is what you are considering here?

            Also do you want to be part of a fraud which in the end would cost everyone else because people earning a wage refuse to pay their due?

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