Local Council Energy Rebate £150 announced by Government

[landlord666]

I have just found out that Students in England are entitled to a share of the £150 per household energy rebate announced by the government. I find this bizarre. Generally speaking most people regard this rebate as a partial refund of council tax payable for the year. Students are 'Exempt' from paying council tax, and so in this respect one would expect there was nothing to refund. However, it would seem it is officially called an 'energy rebate' payable by the local council and through the council tax route.. Fair enough if they are paying the energy bills for the house. The problem I have is that it is me who pays the energy bills. Like so many other student landlords these days, I have had to offer 'bills packages' over the last few years in order to attract people. The Council have said that if there is a joint student tenancy, the first named on the agreement gets a letter asking them to apply for the £150 which will go to his/her account, but when received should be spread between the whole household who were students as at 1/4/22. I can see a few problems happening. Firstly the one student who gets the letter might well apply, get the £150 and then not tell anyone else. Secondly, why should they get the payment when I pay for the energy? It seems unfair and hasn't been thought through properly.
Question : Am I entitled to request the student tenant to send the £150 to me. I suppose the students will argue that they are actually paying the energy through the rent they pay, but the contract started in June last year, so it me who has been hit by the massive increases, and they have effectively got a discount! It seems to be one way traffic at the moment. Everything in favour of the tenant.

[DoricPixie]

You make the payment to the energy company but it is the tenants who pay for the energy through their rent so in my opinion the rebate is theirs.

[nukecad]

You seem to have clocked it - Although everyone, including the government, are calling it the 'Council Tax Rebate' it isn't a rebate at all.

It's a payment from the government to help with rising energy costs. They are just using the Council Tax records to distribute it.

Anyone who has a liability for council tax will get the £150 automatically.

Those who pay CT by direct debit get it paid into their bank accounts the DDs come from. Some have already had it paid
Those who don't pay by DD, and those who have a liability for CT (and so get a bill/statement), but don't have to pay any because of 100% CTR, will be contacted by the council get details of the bank account to pay it into.

Actually offsetting, 'rebating', it against CT bills is only supposed to be done as a last resort if they can't actualy pay it into an account.
Although some councils are ignoring that and doing that anyway, either with or without the bill payers permission.
(It's slightly different in Scotland I believe and they are allowed to ask if the recipient wants it paying or knocking off their CT bill).

The councils have also been given an extra pot of money to distribute as they like - primarily to those who don't have a CT liability, but are still paying for heating.
eg, Tenants in HMO's and lodgers, who may be paying heating bills themselves or included in their rent.

I know of one council that has used part of that extra pot to up the payments from £150 to £175.

That discretionary payment is what your student tenants have been contacted about.
If they had had seperate rental agreements rather than a joint agrement then each one would have got such a letter and could have applied for the payout.

Note that at the same time the £150 was announced so was a £200 payment/discount to electricity bills; that has now been increased to £400.
You will get £400.
Paid directly into the domestic electricity account for the property.

You are not entitled to the tenants £150.
They are not entitled to your £400.

The fact that you fixed the rent and made no provision for energy price rises is a business decision made by yourself and you have to stand by that decision however painful it may seem now.

(PS. Did you ever pay your tenants back if the amount included in their rent for bills was more then you actually paid? Thought not).

[jpkeates]

If the £400 rebate to a landlord means that they receive more money from selling on the energy than it costs, they should rebate the difference, because it's not legal to make a profit on reselling energy.

How anyone is supposed to deal with that I haven't a clue.

[nukecad]

In this particular situation the actual energy cost from the supplier is still the same, so it wouldn't fall foul of the reselling rules.

The £400 is a contribution towards payment of those costs, not a reduction of the costs themselves.
A technical point maybe, but I'm pretty sure it would stand if taken to court.

TBH I'm not sure that 'bills included' counts as reselling?
Unless perhaps the amount for bills is specified seperately from the rent, so becoming an energy charge?
(Which would also be implied if any monetary amount is specified as 'fair usage').

Maybe there is something in the reselling legisation about it, maybe not?

I'm pretty sure that no landlord doing 'bills included' even considers it, let alone calculates it.
I've never heard of a tenant challenging it either (there again they probably never see the actual bills).

[DPT57]

Just increase the rent for the next intake.

[jpkeates]

ITBH I'm not sure that 'bills included' counts as reselling?

It does in other situations, even if it's not broken out.
It's not the same regulations, though, so you could be right.
But if you buy a car with a full tank of fuel, the dealer's sold you the petrol, for example.
It's why no-one gives away kitchen knives with cook books.

But it's hard to be certain - in some cases, where there's communal heating, it's possible that the tenant never actually has any control over what they're being sold.

Maybe there is something in the reselling legisation about it, maybe not?

Not that I can see.

I'm pretty sure that no landlord doing 'bills included' even considers it, let alone calculates it.
I've never heard of a tenant challenging it either (there again they probably never see the actual bills).

Me either.

And I suspect that these new energy rates will kill off the offer of utility inclusive deals until they're back to "normal".

[landlord666]

Thank you to everyone for the informative replies.
On reflection I see why the students get some help as they have paid for the energy from within the all inclusive package. Unfortunately when the contracts were drawn up in January 2021 no-one foresaw how much the prices would go up. Fortunately the biggest rises didn't happen until this April 2022 so the impact wasn't too bad. I accept I have to take the bad with the good!

'Nukecad' you make some very pertinent points, thank you. You raised a point that was interesting. If the contracts had been made on an individual basis, (they're all students) you say each one would have been able to claim. I maybe be wrong, but I was told by my local council some time back that if there are individual student contracts, then the landlord becomes liable for any council tax that may come due in future (if for example one becomes a non-student). If there are individual contracts does the landlord get the annual council tax account (which would be zero if all are students in the house).....or, does each student get their own exempted council tax bill? I always thought there was one council tax account per house.

[jpkeates]

If there are individual contracts, the landlord is responsible for the council tax (and for compiling the exemption information).

[nukecad]

You raised a point that was interesting. If the contracts had been made on an individual basis, (they're all students) you say each one would have been able to claim. I maybe be wrong, but I was told by my local council some time back that if there are individual student contracts, then the landlord becomes liable for any council tax that may come due in future (if for example one becomes a non-student). If there are individual contracts does the landlord get the annual council tax account (which would be zero if all are students in the house).....or, does each student get their own exempted council tax bill? I always thought there was one council tax account per house.

Yes the landlord of a HMO is liable to pay the Council Tax, whatever kind of TA the tenants have.
Unfortunately though that HMO CT liability is specifically excluded from getting the £150, the landlord will get his own £150 from his own CT.

I wasn't suggesting that they would get it because they would have a council tax liability (bill), if they did have a CT liability (even if not actually paying anything) then they wouldn't have to apply at all and would get it automatically.

For those who don't have a CT liability and so don't qualify automatically there is a seperate discretionary fund, it's that fund that their letter was about.

I was saying that if they had had individual tenancies then each one could have applied seperately to the discretionary fund.

However because they have a joint tenancy then the council have said that they can only make one application in the name of the first person named on the TA, which is what it said on the letter that they got.
So the council is telling them that because they have a joint tenancy they can only apply for £150 to share between them instead of £150 each.

TBH that is that particular councils rule, it is a discretionary fund, and so each council has discretion over how much of it they will pay and who to.
Other councils will have their own rules about how they want to distribute it.
(As I said above, I've heard of one council who have used part of their discretionary fund allocation to give payments of £175 instead of £150 to those with a CT liability, I guess they don't have may HMO tenants or lodgers to give it to in that area?).

[DPT57]

Yes the landlord of a HMO is liable to pay the Council Tax, whatever kind of TA the tenants have.

The landlord would not be liable for the CT of a joint tenancy HMO unless it was during an SPT and the tenants had left the property.

[nukecad]

Fair enough,

The point is that this payment, whether automatic through CT liability or applied for from the discretionarly fund., is per-household. (Per CT bill).

A joint tenancy can be regarded as one household. (not always, but can be).