House Sale/Council Tax quandry

clutton_2

so only £7k to pay then ................

silvercar

Are you sure there is nothing in the deeds and/ or planning approval for the cottage that prevents it being a separate dwelling?

If so it will cost you more than the lost council tax in resale value.

My guess would be that it is banded as part of the main house. There is a site where you can check the banding of properties, that will show you if it is rated separately and what band it appears.

kje_2

When you come to sell what will show up on the searches ? Two properties or one ? How can you knock a doorway into the cottage if it's a separate property ? What about planning permission and building control ? Strange.

silvercar

Read here for CGT implications, in particular "gardens and grounds" on page 3.

http://www.hmrc.gov.uk/pdfs/2003_04/capital_gains/ir283.pdf

lincroft1710

For council tax purposes a property can contain more than one "self contained unit" i.e. separate dwelling, even if planning law only permits a single dwelling. Don't ask !!! Council Tax is a law all unto itself.

CIS

If the cottage is listed as a separate dwelling, it is highly improbable that council tax hasn't been paid - even if it hasn't, billing authority can only ask for seven years back money.

Council Tax can be back billed as far as 1/4/1993 - their is a 6 yr limit on applying for a liability order from the date a bill is issued.

Check the Valuations Office website (https://www.voa.gov.uk) to see if the property has been banded or not or alternatively ask any of the tenants as to whether they have paid Council Tax.

If the property should be liable and hasn't been paid for then providing you can supply tenanacy agreements you will be liable only for the Void periods which may be covered by a Class C exemption and/or unoccupied discount.

lincroft1710

I worked in the VO for 35 yrs and although some billing authorities would "try it on" when we backdated (legally) a new dwelling to 1/4/1993, in law they could not enforce a demand which went back more than 6 yrs. Although OP has let cottage for 10 yrs a) was this continuously to same person b) has he owned house for a longer period.

CIS

The CTax(Admin and Enforcement) Regs 92 say nothing about only being able to bill for 6 years what is does state is that a bill cannot be enforced with a Liability Order if it has not been issued within 6yrs of the date of billing.

lincroft1710

It maybe that the billing authority I spoke to had misinterpreted regs, but I understand that an unpaid bill which is outstanding over 6 yrs and no attempt has been made to follow it up cannot be enforced. Therefore they do not issue demands for more than 6 yrs back tax.

CIS

It maybe that the billing authority I spoke to had misinterpreted regs, but I understand that an unpaid bill which is outstanding over 6 yrs and no attempt has been made to follow it up cannot be enforced.

Once a bill is issued then it must be followed by a reminder before the Summons can be issued.Its the summons that is issued to apply for a liability order. The legislation stops a Liability Order being issued if the bill is over 6 yrs old.

Unless a Liability Order is issued the council have no legal enforcement powers they can only request payments.