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Council Tax after death?
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# 1
ScotInEngland
Old 19-01-2009, 11:14 AM
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Default Council Tax after death?

I am executor of my late MILs estate which which is really only her house.

Probate has been granted and the local Council gave 6 months free of Council Tax.

That 6 months is up and now the council is sending bills for the remainder of the years CT.

The bill is addressed to "The Executors of........" and the property is unoccupied. (has been up for sale but none of those making offers could proceed). The council are insisting that I make monthly payments on this account.

Now my question is should I be making these payments?

It seems the CT can become chargeable after the 6 months but my concern is about actually making the payments now.

I understood that as executor I had establish all debts and all assets then once all that info is available distribute the estate, paying debts in a prescribed order then if anything left distribute to beneficiary. I also understood that no debts (other than funeral expenses and Inheritance Tax) should paid until the final balances were known.

So as far as I can see the council should wait until the estate is finalised before being paid.

One major problem is the estate has no way of making the payments, there is no money only the house. So the only way to make a payment would be out of my own pocket which I can't afford.(I get CT benefit towards my own CT) and I didn't think executors were supposed to do this.

Does anyone know what the rules are when it comes to an estate paying these charges?
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# 2
Andy L
Old 19-01-2009, 11:27 AM
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The estate can either borrow money (secured against the house) or could just not pay & the council will, ultimately, take the estate (not you) to court for non-payment & have an attachment made against the value of the house when it is sold for the unpaid bill plus legal costs.

Which council are you dealing with?
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# 3
ScotInEngland
Old 19-01-2009, 11:30 AM
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Quote:
Originally Posted by Andy L View Post
Which council are you dealing with?
Shepway District Council.
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# 4
Quietmanc
Old 19-01-2009, 11:50 AM
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I am in exactly the same situation,but in Wales-don't know if there are any differences.This morning I received a letter from the Council stating that there is an imminent review to the 50% 'long term empty' discount "in the light of the developing Empty Homes Strategy(currently at consultation stage)" The bottom line is that our Council may decide not to allow any discount as from 1st. April 2009.Sorry that I couldn't be more positive.
I have already made two monthly payments @ 50% discount BTW.
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# 5
ScotInEngland
Old 19-01-2009, 1:31 PM
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Quote:
Originally Posted by Quietmanc View Post
I have already made two monthly payments @ 50% discount BTW.
I guess the 50% discount is something although worrying that they are to review it.

Shepway allow a whole 10% discount for an empty and uninhabitable house. :confused:
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# 6
mollymoo12
Old 19-01-2009, 5:58 PM
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The Council would need to take action through the County Court for an "Exors of" account. They cannot obtain a liability order from the magistrates court. This means they are much less likely to take this action so try and negotiate something with them - you could see if they would accept a solicitors undertaking to pay the debt when the house is sold (your solicitor writes a letter promising to pay up when the property is sold). I know it is not much use to you now but what you ought to have done is kept the property furnished and then when the 6mths after probate came to an end removed the furniture on that day - you would have then been eligible for a Class C unfurnished and unoccupied exemption for further 6 months. The Class F you were granted when your MIL died is granted regardless of whether the property is furnished or not.
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# 7
ScotInEngland
Old 19-01-2009, 6:31 PM
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Quote:
Originally Posted by mollymoo12 View Post
I know it is not much use to you now but what you ought to have done is kept the property furnished and then when the 6mths after probate came to an end removed the furniture on that day - you would have then been eligible for a Class C unfurnished and unoccupied exemption for further 6 months.
I hadn't thought of that so thanks for the info. It may not be too late to gain something from this approach. By empty I meant no-one living there, we had a good clear up but basic furniture is still there so I guess we could empty that out and start a 6 month Class C exemption now.

Selling seems to be completely out of the question so I think we're going to have to either make some basic repairs and move in or put a caravan in the garden & live in that, either way that'll end any exemption. I can't manage many more months of renting our current house and paying for MILs.
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# 8
Mikeyorks
Old 19-01-2009, 10:04 PM
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As post #2 .... you may need to consider (do you have an Exor account?) an overdraft or similar until the property is sold?

As well as CT surely you have ongoing liability for (in this weather) gas / electric for heating / house Insurance etc etc?

I'm in a similar position with an Exor property on the current market (which actually started to move a bit exactly a week ago - 2 x FTBs suddenly expressing interest) and have ongoing bills for the empty property. The basic assumption that all bills are crystallised and then paid out just before distributing the estate to the beneficiaries falls apart in the current market, I'm afraid
If you want to test the depth of the water .........don't use both feet !
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# 9
mollymoo12
Old 20-01-2009, 8:20 PM
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I am going to apologise in advance as I am about to make things even more complicated for you.

You have said that there is some basic furniture left in the property. Now, if the council thought the property was empty of furniture when Class F expired they will have billed you at 50% of the full charge.

However, if a property is unoccupied but still furnished, the charge is 90% for Shepway Council, per their website. (Councils have the discretion to now to charge between a 50% and 90% of the full charge on furnished properties, some kept to 50% but some charge upto 90% on furnished properties, it varies across the country but Shepway charge the maximum of 90% of the full charge).

Therefore if you now tell the Council that the property was furnished, you will probably face an increased charge from the date the Class F exemption expired to the date you remove the furniture. On the other hand though, you will gain a 6 months Class C exemption from the date the furniture is removed so overall you will be better off.

Just a warning for you.

Last edited by mollymoo12; 20-01-2009 at 8:32 PM.
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# 10
Hermann
Old 20-01-2009, 8:50 PM
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Thanks again for the info. As per post 6 Shepway are already only allowing a 10% discount!

There's been 6 months post probate at nil charge and since then a 10% discount applied so thankfully there should be no increase.

Interestingly no-one at the council has ever asked whether the house was furnished or not.

Its no surprise that Shepway charge the max thats allowed, they are truly awful!
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# 11
CIS
Old 20-01-2009, 8:56 PM
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Many council's are heading that way with charges, in addition many are heading to a 100% charge for unoccupied and unfurnished properties after the 6 month Class C.
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# 12
Hermann
Old 20-01-2009, 9:34 PM
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Quote:
Originally Posted by CIS View Post
Many council's are heading that way with charges, in addition many are heading to a 100% charge for unoccupied and unfurnished properties after the 6 month Class C.
Yeah ..... I guess the sooner they can rack up enough unpaid CT the sooner they can take possession, get a central Government grant to renovate and then rent it out for themselves!

"These people can't pay so lets double their liability" ..... I sense some bankers logic here.
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# 13
CIS
Old 20-01-2009, 9:59 PM
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Quote:
Yeah ..... I guess the sooner they can rack up enough unpaid CT the sooner they can take possession, get a central Government grant to renovate and then rent it out for themselves!
The council can't just seize property for unpaid council tax.
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# 14
Hermann
Old 20-01-2009, 10:18 PM
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Quote:
Originally Posted by CIS View Post
The council can't just seize property for unpaid council tax.
Well there's a few hoops to jump through first.

I guess 'take possession' should more accurately have been 'force sale to themselves'

My understanding is that the Law of Property Act 1925 states that a local authority with a debt on a property can register the debt as a first charge with Land Registry, taking precedence over any mortgage, and is thus empowered to force a sale. The properties I'm aware of have all been sold to the council/their agents, got grants (where none were available to the previous owners) and are now rented. I believe some may be offered at some point as shared ownership schemes.

Undoubtedly this is going to become a lot more commonplace.
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# 15
brdee123
Old 24-08-2009, 2:45 PM
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Default Justification

How on earth can a council justify a large slice of council tax if a property is unoccupied due to death until it is either reoccupied or sold?

Surely the house would not have rubbish collected on a daily basis, no services to speak of apart from perhaps a bit for Police services etc which a a very small part of the overall cost.
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# 16
Pumpkinface
Old 24-08-2009, 2:51 PM
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I am the administrator of my father's estate. He did not leave a will, so I was not a nominated executor initially and it was my siblings who dealt with the council. They established that there is no council tax and there never will be for so long as we have the house there, empty and up for sale. Six months is about up and I have not heard anything to the contrary.

I am sure I would be quite happy if the council "forced a sale" because I can't sell it.
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# 17
dzug1
Old 24-08-2009, 2:53 PM
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Quote:
Originally Posted by brdee123 View Post
How on earth can a council justify a large slice of council tax if a property is unoccupied due to death until it is either reoccupied or sold?

Surely the house would not have rubbish collected on a daily basis, no services to speak of apart from perhaps a bit for Police services etc which a a very small part of the overall cost.

The 'justification' may be they need the money and that central government will cut their grant if they don't.

'Cost' really has nothing to do with it
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# 18
lincroft1710
Old 24-08-2009, 4:45 PM
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Neither the government nor councils like the idea of empty properties, especially when there is a perceived housing shortage. Therefore any concessions for empty/unocc properties are probably kept to a minimum so that there are less incentives for owners to keep properties empty.

Last edited by lincroft1710; 24-08-2009 at 5:42 PM. Reason: Omitted the word "probably"
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# 19
00ec25
Old 24-08-2009, 4:54 PM
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Quote:
Originally Posted by lincroft1710 View Post
Neither the government nor councils like the idea of empty properties, especially when there is a perceived housing shortage. Therefore any concessions for empty/unocc properties are kept to a minimum so that there are less incentives for owners to keep properties empty.
still smacks a bit though where owning a second home I only get 10% discount whereas on my main home I get the full 25% SPD - they get an extra 15% for a mainly unoccupied house,

wish we could all automatically be paid higher rates by those customers who use us less
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# 20
Pumpkinface
Old 24-08-2009, 5:24 PM
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Quote:
Originally Posted by lincroft1710 View Post
Neither the government nor councils like the idea of empty properties, especially when there is a perceived housing shortage. Therefore any concessions for empty/unocc properties are kept to a minimum so that there are less incentives for owners to keep properties empty.
I think councils should be collecting money to pay for services rendered, not to moralise to people over empty properties. And especially not to executors of a will who are trying to sell but are unable.
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