Tenancy Agreements - 4 tenants

booksurr

mchale wrote: »

Bear in mind with 4 tenants on 1 AST LL could be held liable for CT if tenants don't pay it, It would be advisable to charge CT in with rent.

wrong, if the LL attempts to charge CT in with the rent and identifies it as such when he is not liable that is illegal. You have forgotten that the definition of an HMO under the Housing Act has nothing to do with that for CT and would certainly never be based on what you have written

For CT purposes only either the LL or the tenant(s)are always liable, it cannot switch between the 2 of them if one does not pay whilst being liable to do so.

what makes a CT "HMO" is defined in terms of the number of households in occupation, in the case of a joint tenancy agreement the initial presumption must be that the residents will be living as one household and therefore it is NOT a CT HMO and the LL is not liable whilst the occupants continue in residence. However, it could also under certain circumstances be possible to have a CT HMO despite the fact there is but a single tenancy agreement

there is no clear cut definition of "household" but that is the primary determinant -
read:
"What is a Single Household?
There is no legal definition of what constitutes a single household. The expression ‘household’ and membership of it is a question of fact and degree. Similar circumstances may result in a different outcome depending on the extent to which the varying constituents are present.

For instance, no one would argue that a family consisting of parents and children was anything other than a single household. However, many households contain individuals who are not related to each other but still regard themselves as a single unit. The considerations below are neither exhaustive nor in any order of priority but should prove useful guidance:

the size of the household
the size of the dwelling
the type and extent of any communal living
use for temporary periods only
use of share facilities
the degree of anonymity
the extent to which independent lifestyles are pursued
did the group come to the property as a group or were they recruited separately?
are external locks fitted to bedroom doors?
How are the utility bills resolved?"

mchale

booksurr wrote: »

wrong, if the LL attempts to charge CT in with the rent and identifies it as such when he is not liable that is illegal.

What ever my friend, all I know is my LA have confirmed to me via email if I rent a property to 3 or more unrelated tenants on 1 AST agreement and the tenants do not pay the CT then they will pursue me for the CT charge.

Out of interest could supply a link that to the law that makes it illegal to add CT charges to the rent.

HappyMJ

mchale wrote: »

Bear in mind with 4 tenants on 1 AST LL could be held liable for CT if tenants don't pay it, It would be advisable to charge CT in with rent.

You do say "could" so OP it's best to check with the council as council tax is also issued as a joint bill where all named are jointly liable to pay for the whole bill and the bill should have all 4 names on it the same as the tenancy agreement.

If the house were large enough I'd rent to a couple then allow them to have a lodger. Then it wouldn't be the landlords problem to deal with the council tax or HMO regulations.

dancingfairy

I believe there are 2 different version of what constitutes an HMO. One is for council tax purposes and one is for building regs/healthy and safety.
If you do seperate tenancies then it would be an HMO for council tax purposes (and the landlord is liable), if it's one tenancy then the tenants are liable.
Like I said, building regs/healthy and safety/fire alarms etc is a different department at the council so make sure you clarify with both departments as it can be an HMO for one purpose and not the other.
df

HappyMJ

dancingfairy wrote: »

I believe there are 2 different version of what constitutes an HMO. One is for council tax purposes and one is for building regs/healthy and safety.
If you do seperate tenancies then it would be an HMO for council tax purposes (and the landlord is liable), if it's one tenancy then the tenants are liable.
Like I said, building regs/healthy and safety/fire alarms etc is a different department at the council so make sure you clarify with both departments as it can be an HMO for one purpose and not the other.
df

It actually depends on the local council. Some council's it's more than 2 unrelated households either in the property or on the one tenancy agreement some councils it's not and just having 2 households in the property counts as a HMO although they make exceptions for live in landlords having a lodger.

4 people can be listed on a council tax bill. It'll list the first two listed on the tenancy agreement on the top of the bill and then list everyone else as other liable persons somewhere else on the bill. All are equally liable for the bill.

booksurr

mchale wrote: »

What ever my friend, all I know is my LA have confirmed to me via email if I rent a property to 3 or more unrelated tenants on 1 AST agreement and the tenants do not pay the CT then they will pursue me for the CT charge.

Out of interest could supply a link that to the law that makes it illegal to add CT charges to the rent.

"whatever" will be an excellent defence in court when your tenants sue you for the return of monies they had no legal liability to pay you

as you clearly have no interest in educating yourself I am not going to do it for you, read the Council Tax (Administration and Enforcement) Regulations 1992

or read the posts from CIS recounting how their job requires them to refund tenants and then chase LL for unpaid CT because of incorrect liability

villieb

ok, so i've called the local council to enquire whether I'd be a HMO or not, advised about the 4 tenants, two being brothers... they've told me I am not, so that's that covered.

I will be going down the 1 AST covering all four tenants because after thinking about it, if I were to have 4 separate I'd still have paperwork to do if one of them moved out etc...

Thanks for all the replies and help!

HappyMJ

villieb wrote: »

ok, so i've called the local council to enquire whether I'd be a HMO or not, advised about the 4 tenants, two being brothers... they've told me I am not, so that's that covered.

I will be going down the 1 AST covering all four tenants because after thinking about it, if I were to have 4 separate I'd still have paperwork to do if one of them moved out etc...

Thanks for all the replies and help!

Thank you for your update. Just for everyone else as I said in my post just before this. This is not the case for every council so everyone else do your own checks with your own council.

booksurr

HappyMJ wrote: »

It actually depends on the local council. Some council's it's more than 2 unrelated households either in the property or on the one tenancy agreement some councils it's not and just having 2 households in the property counts as a HMO although they make exceptions for live in landlords having a lodger.

4 people can be listed on a council tax bill. It'll list the first two listed on the tenancy agreement on the top of the bill and then list everyone else as other liable persons somewhere else on the bill. All are equally liable for the bill.

you are confusing yourself between the definition of HMO for council tax purposes and the definition (with some discretion) that a council has over an HMO for Housing Act purposes

CT liability is based on the hierarchy of liability, you misunderstand the rules if you think a live in LL with a lodger is an "exception"

a lodger is an occupant with a licence/ excluded occupier
a resident LL (whether they be an owner or themselves a tenant of the freeholder) is an occupant with a higher interest in the property than a mere lodger

therefore under the hierarchy the resident LL will always be liable for the whole CT, and the lodger will never be liable for any CT. If there are 1, 2 or 20 lodgers the situation remains the same, technically it is a council tax HMO as there are 2 or more households present (LL and lodger) but the LL always has the liability because it is a CT HMO (which is not the same as a Housing Act HMO)

councils do not make up "exceptions", the follow the legislation as written

red40

villieb wrote: »

ok, so i've called the local council to enquire whether I'd be a HMO or not, advised about the 4 tenants, two being brothers... they've told me I am not, so that's that covered.

I cant believe that a local authority still dont understand what a HMO is (actually I can :cool:) but regardless of what the council say you will have a HMO pursuant to the Housing Act 2004. The definition of a HMO is quite clear in section 254 to 257, but if the council say you dont, just make sure you get them to confirm this in writing.