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Three months empty council tax discount disagreement.

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I have continuous issue with the council on the council tax. I have read similar threads already, but none same.
In mid march 2015 I suspected that my tenants had abandoned (rents not paid etc). During the property inspection they left sufficient furniture and items. To be legally cautious, I left notice of abandonment to repossess the property in one month time. The property subsequently cleared out on mid April followed by extensive refurbishment and finally rented out on mid July. I expect to get the three month empty 100% council tax discount (mid April to Mid July). But the council says that the Tenants had registered their Council Tax to a different address on end of January, so the unoccupied 100% discount 3 months already given before I took back the property in mid April.
I believe that the 3 months discount should start on mid April because the property was furnished and tenanted. And before mid April I should not be responsible for the Council Tax. I do not know how best to push the issue with the council tax people.

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Unfortunately for you I don't believe you will win the argument with your local council

The tenants are entitled to the discount because they were paying full c/tax on another property. The discount is not subject to a property being furnished or not or tenanted or not.

However, I do believe you may be entitled to some compensation .....from the tenants, not the local council. Most tenancy agreements make the tenants responsible for payment of utilities during the tenancy.

Any c/tax expense you have incurred whilst a tenancy agreement is in place is the responsibility of the tenants. Obviously once you take possession of an abandoned property the tenancy is ended. You could claim any expenses from their deposit or their guarantor or take action in the courts.

Most landlords have incurred these types of expenses at some point. In my case it's usually a relatively small amount in total, perhaps £50, it's tax deductible and hardly worth the effort to recover.

In some respects you are lucky, my council only provide a 50% discount for 3 months not 100% as in your case.

Good luck.

Let us know how you get on.

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If the tenants were in their fixed term of their tenancy you could show the council the tenancy agreement to argue the point and prove the tenant was still legally responsible until you retook possession of the property.

If not and the tenancy was periodic this is a prime example where the differences between a contractual and statutory periodic tenancy come into play.

Read your tenancy agreement and if it clearly states the contract becomes a CONTRACTUAL periodic tenancy (after the fixed term) the tenant are responsible for the council tax until the tenancy is legally ended which in your case would be when you took back the property. 

Note: Most tenancies especially free ones off the web will not state  CONTRACTUAL

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IMHO.....Showing the fixed term tenancy agreement will make not a bit of difference. As I understand it the tenants have been paying the council tax. The fact that its at a reduced rate is because that's how it works, that's the rules, that's their entitlement and that's what anyone is entitled to. The tenants have fulfilled their obligation contained in the tenancy agreement to pay the council tax.

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It comes down to "material interest" & "The hierarchy of liability"  which is all clarified in the Local Finance Act 1992

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

Provided the landlord granted a tenancy for at least 6 months the tenant is higher up the chain than the landlord for liability of the council tax and tenant tenant is liable until the tenancy is ended. Thats why CONTRACTUAL periodic comes into play if it then becomes periodic.

There have also been some court cases in the higher courts clarifying  the above.

Once again you will find the council will try their luck to get the funds from the landlord until you start quoting their own rules and regulation. 

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Grampa, I think we are both talking about different things.

I am specifically addresing the OP's question concerning the 3 month discounted council tax payment. The tenant appears to have received the discount so that it is no longer available to the landlord. My understanding is that the discount doesn't belong to the landlord. It is available to anyone who qualifies for it.....in this case it's the tenant. The tenant having paid the c/tax has met their obligation and liability to pay that tax during the term of their tenancy.

I am in total agreement regarding hierachy and if, during the period of the tenancy and prior to the landlord taking possession, the tenants did not pay c/tax....it's the tenants responsibility to pay it.

However, the OP's post does not say if the tenant has failed to pay c/tax during the tenancy only that they have used the discount.

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Grampa perhaps you can clarify, the term contractual periodic is new to me.

My AST's state clearly when a fixed term defaults to statutory periodic, as it's stated within the contractual agreement is this the same as defaulting to contractual periodic?

I have had similar issues with the Denbighshire council over council tax liabilities. A lot seems to come down to the discretion of the particular council. When a T absconds the council tax liability reverts to me, that is from the day the T has registered at a new property. As RL, if there is a charge it is then for me to recover that from the exT. As Denbighshire offer a period of zero rating for an MT property this is usually a no cost effect to me as long as the void doesn't take me to a chargeable period.

Previously though I have informed the council that belongings were still present in the property, till a date decided by me effectively, the council then reversed the change of liability and charged the exT until such time that the property was actually MT. This would be when I removed the belongings (and stored securely at the local tip). This could help the op as the tax free period would then be deferred. As said though this may be discretionary.

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Thank you to all responses.
To clarify. The council accepted the fact that the tenant is responsible for the council tax. But they have given them the empty discount. By the time I was able to retake the property. The discount period had ran out. The fact is, up until mid April, the tenant had the right to the property and enough furniture to be making use of the property. So my argument is, the empty discount should start in mid April when the property really became empty.

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20 minutes ago, Richlist said:

Grampa, I think we are both talking about different things.

I am specifically addresing the OP's question concerning the 3 month discounted council tax payment. The tenant appears to have received the discount so that it is no longer available to the landlord. My understanding is that the discount doesn't belong to the landlord. It is available to anyone who qualifies for it.....in this case it's the tenant. The tenant having paid the c/tax has met their obligation and liability to pay that tax during the term of their tenancy.

I am in total agreement regarding hierachy and if, during the period of the tenancy and prior to the landlord taking possession, the tenants did not pay c/tax....it's the tenants responsibility to pay it.

However, the OP's post does not say if the tenant has failed to pay c/tax during the tenancy only that they have used the discount.

You are quite right RL I sort of went off at a tangent but they do overlap slightly.

 

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I agree, it wasn't MT,

Councils are happy to charge the same person for council tax on 2 properties when it suits them. 

Are the council aware that the property was furnished till mid April?

Are the council aware that the T was still as a T till mid April?

Be careful you don't enter the area of a possible illegal eviction claim. Also a T (exT) could feasibly claim for the value of belongings that you disposed of. Fore thought to these points might well affect your strategy.. 

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5 minutes ago, Square said:

Thank you to all responses.
To clarify. The council accepted the fact that the tenant is responsible for the council tax. But they have given them the empty discount. By the time I was able to retake the property. The discount period had ran out. The fact is, up until mid April, the tenant had the right to the property and enough furniture to be making use of the property. So my argument is, the empty discount should start in mid April when the property really became empty.

Well the tenants should definatly be responsible for CT during their fixed term without a doubt (or up to the date you took possession in the fixed period if that happened). So I cannot see why the council should allocate any free period within that term/period.Once you took possession you should then get any free period if applicable.  

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15 minutes ago, Carryon Regardless said:

Grampa perhaps you can clarify, the term contractual periodic is new to me.

My AST's state clearly when a fixed term defaults to statutory periodic, as it's stated within the contractual agreement is this the same as defaulting to contractual periodic.

I have had similar issues with the Denbighshire council over council tax liabilities. A lot seems to come down to the discretion of the particular council. When a T absconds the council tax liability reverts to me, that is from the day the T has registered at a new property. As RL, if there is a charge it is then for me to recover that from the exT. As Denbighshire offer a period of zero rating for an MT property this is usually a no cost effect to me as long as the void doesn't take me to a chargeable period.

Previously though I have informed the council that belongings were still present in the property, till a date decided by me effectively, the council then reversed the change of liability and charged the exT until such time that the property was actually MT. This would be when I removed the belongings (and stored securely at the local tip). This could help the op as the tax free period would then be deferred. As said though this may be discretionary.

For the contractual element to work the AST should clearly state that at the end of the fixed term this contract continues on contractual periodic basic until legally ended.

I don't know finer points of the legalise and thinking behind it. But I think it means that if the AST reverts to a statutory periodic once the tenant has gone they have gone and liability ended. (or maybe to the end of that monthly period?) But if it is Contractual periodic it falls under the same rules as the liability until the end of the fixed term which means it (plus liability) continues until legally ended which could be by mutual agreement, court order, giving notice and it being valid and or accepted.

I hope that makes sense. 

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Thanks Grampa, I think I've got that.

As I understand even without a contract in place a T needs to give 1 months notice (I'm not talking of weekly paid rents here but due monthly). although in Oct 2015 things changed for the LL the T's notice still expires on the last day of a tenancy period (or for some very confusing reason the 1st day of the next (and T's choice)). W/o contract the 1st day of of the T taking the keys would demonstrate the start point of a SPT. So as with many AST's, and mine, a T once into a SPT needs to give a minimum of 1 month notice (not 4 weeks as many try), until they have served notice, and it has expired they have full responsibility toward the property even if they have chosen to depart. Even then posting keys through the box doesn't end the tenancy, although in practice i might use my key to enter, and accept that.

All of my above points can be gained from the Shelter website (and others), a print off from Shelter 'should' be reasonable evidence I would have hoped.

The T, assumed to be exT, in this  case could say "it was my flat, I was still in possession. The LL shouldn't have done that". Ambiguity steps in and those that might defend the poor down trodden T love that. My way to head that one off is to be sure that the monies owed me would offset any claim by the T (exT). 

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2 hours ago, Square said:

Thank you to all responses.
To clarify. The council accepted the fact that the tenant is responsible for the council tax. But they have given them the empty discount. By the time I was able to retake the property. The discount period had ran out. The fact is, up until mid April, the tenant had the right to the property and enough furniture to be making use of the property. So my argument is, the empty discount should start in mid April when the property really became empty.

I think your confusion here is over the definition of the word 'empty'. Your definition is that of empty of furniture & effects. The council definition is that of empty of residents......because they were registered and paying full c/tax at another property they could not be in two places at the same time. More to the point, they could not sleep at two properties at the same time and its an overnight stay that determines wether they are resident.

I understand your disappointment, many of us have been in a similar position.

If you do win your argument I'd appreciate you letting the rest of us know. 

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But if a home owner also owned a holiday home surely they must pay CT on both properties? 

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Yes I believe that is the case.

 AIUI.....to qualify for the discount my local council require the property to be empty .....of people and substantially unfurnished. Clearly a holiday home would only qualify for one part of that requirement because it's likely to be fully furnished.

The OP might well believe the property remained furnished but I suspect the tenants said it wasnt and of course that could be backed up by proving they had already moved somewhere else permanently.

How would the OP prove otherwise ?

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Just 1 item of furniture in my rentals qualifies for CT payment.    Incidently there is no "period of grace for CT" with my local council. I would love to have 3 months or even just 1 month would do.

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Yes they 'can' be required to pay c/tax on two properties without a discount. But, if I were a betting man, I'd wager that in this case, where they have moved elsewhere permanently, there is no way that they will be charged the full amount. There is no evidence that they are liable to pay the full amount,  no proof  is being offered and the opportunity of obtaining it has long gone.

Sometimes life ain't fair and clutching at straws is a waste of time.

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Nope,

A second home, a holiday home, is paid at 150% nowadays, as are our properties if they are mt long term. The length of time mt is discretionary.

The local council, as do utility providers, accept a T's word of when they departed a property. If not the T informing the council will become aware from a redirected HB claim. 

The council may request an inspectors visit to see mt. If a LL isn't aware of the abscond this can't be facilitated. Writing to the council and offering a affidavit would be difficult to reject as evidence. 

However if you haven't been served notice and are paying ct on behalf of the T then suing the T might become the easiest option. The council will have a legal dept to make things awkward but generally they are under staffed and take the lazy route.

If at first you don't succeed your not a bird.

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On 28/04/2017 at 7:19 PM, Melboy said:

Just 1 item of furniture in my rentals qualifies for CT payment.    Incidently there is no "period of grace for CT" with my local council. I would love to have 3 months or even just 1 month would do.

Same with my Council, not even a day's free CT when empty or being renovated. We usually turn our properties round quickly so between two days to two weeks so not a massive problem but still an admin PITA. I think it must have cost the council more to process the last CT bill of less than £10 for two days.  Sigh. 

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Don't forget it's not all bad news, landlords are still entitled to at least a 20 - 40% discount on any council tax they pay through their tax returns.........which is more than can be said for future mortgage interest payments.

In my part of Essex we get 50% discount on empty & unfinished property for 3 months. So let's do the maths........let's say my full council tax is £100 a month. I get 50% off so I pay £50 per month. The £50 is offset as a business expense at 40% so in real terms I only pay £30 instead of £100

Sounds absolutely fantastic to me.......far more than I should ever expect or deserve. Wouldn't surprise me if this PERK is curtailed in the near future.

I'm working hard on plans to reduce the remaining £30 to nothing & of course, incorporation would probably reduce it further.

The more I think about it, the more I am convinced that council tax discounts and/or tax breaks equal one of the best money off offers available.

For those that receive these discounts there are very few other expenses with letting property that offer anything like it. 

But then some people just like having something to moan about. ?

 

 

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