Council Tax Dispute

Confuseddotcom101

Hi All,


I will try to be as concise as possible to explain a situation which is now causing me considerable distress, but am trying to include all relevant facts.



In October 2017 my partner and I stayed for a month in a holiday park in a different area. We were trying to assess whether it would be the right thing for us to make a move, so testing the water. Jump forward to March 2018 and we agree "rights of occupation" for a lodge with the site manager on a month by month basis for £750 to include all bills apart from electricity. There was no question of Council Tax being payable because the lodge formed part of the holiday park, and certainly wasn't on the official list, presumably because business rates were being payed by the owner. We continued to own, and regularly go back to, our other house, and paid the full rate of Council Tax on it until the end of June 2018 when it was sold. The original plan had been to coordinate the purchase of a new property with the sale of the old one and to only ever stay in the holiday park (a dive) for a few months maximum. But things don't always go to plan, and we had three properties fall through before completing on the fourth purchase in June 2019. Only a year late!


At some point over the summer of 2018 the majority of the holiday park went into administration but we were advised by the site manager that it didn't affect our lodge and we could continue to stay there as long as we needed. Other lodges were also occupied on this basis, but whether or not their tenancies were any more official, I couldn't say. Rumours began to circulate that we (and others) would soon have to start paying Council Tax, but this didn't happen while we lived there, and had it done, we would have asked for a corresponding reduction in the agreed monthly payment. The lodge is certainly not worth £750 per month exclusive of bills.



There is no dispute that the lodge was our sole main residence from June 2018 to June 2019, and that officially, we are the first people on the "hierarchy" list by virtue of our occupation in respect of that period. What the dispute relates to is how the attempt to charge us has been undertaken.



Just before moving out, we were cautioned by another occupier to "be careful regarding our council tax". She said she had been being billed since May. I didn't really take her too seriously as I didn't believe they could retrospectively bill us, and when I checked the Council Tax list just before we moved out neither her property nor ours were on it. We phoned the Council about a week after becoming the owner occupiers for the new property and agreed an instalment plan with them, which is being paid by monthly direct debit. Two months later, the end of August this year, we received a bill, sent to the new property, but relating to the lodge, for the period from 15th March 2019 to the end of March 2020. This asked for £57.65 to be paid immediately for the period to end of March 2019, and then £211 a month (on top of Council Tax for new property!) to be paid from 1st October 2019.


We immediately contacted the Council by email asking them to put a stop on the bill, and to ask how they could justify it on the basis that we were neither the owners nor current occupiers of the lodge. We received no reply apart from a standard one saying they were busy, and as time went on I assumed the matter had been dropped, until we received a reminder notice, dated 23rd September but received on 26th, saying if we didn't pay the amount of £57.65 within 7 days (which takes us to tomorrow), a court summons will be issued.


Upon a chasing telephone call, we were finally sent an email on Friday which does not even attempt to explain why we are being billed up to March 2020 when they are fully aware that we don't live there, but just asked us to clarify it we did live there previously, and if not, where we did live and to provide evidence of this. I sent a fairly curt email back giving them the information they required but stating that as we had never received a valuation notice from the VOA it wasn't legal for them to pursue Council Tax for the period prior to which they sent their first bill, which at that point should have been sent to the new occupiers or the owner. I truly believed this to be the case at the time, but having spent almost my entire weekend looking up legislation it would appear that in certain circumstances an alteration to a Council Tax List can be backdated, depending on the reason for the alteration. As we haven't received the notification from the VOA I 'm not sure what the "official" reason for the alteration was - i.e. a non domestic property to a domestic property, or a "composite heriditament" turning into individual dwellings. To be honest, I'm not sure that there is even an official reason that they would be able to quote.


Even though I think the way they went about the whole thing is abhorrent, I have no desire to avoid a tax for which we are legally liable. My immediate issue is whether we should pay the £57.65 tomorrow to avoid the court summons, but this feels like an admission that the entire demand notice to March 2020 is legally correct, when it most certainly isn't.


Having wanted to be concise, I realise I have probably waffled a bit, but if you are still reading and have any relevant advice we would be truly grateful. Generally we both like to treat people as fairly as possible, and it does grate when we don't receive the same treatment in return. I have already taken on one Council Tax battle in the past due to the VOA's attempt to reband the property in our old area, and won after many many months of battling (details to be provided on request, in case it helps others in the same situation). I really don't want another battle but just unsure of the best action to take in view of the potentially imminent summons if they don't back down.


Thanks!

CIS

Assuming England,


I see probably 2 or 3 cases per year involving caravans and most are in a complete mess when I see them, but that is not always the council's/VOA's fault.

Council Tax is a creature of legislation - in this case it is an artefact of 'sole or main residence' and being resident. Regardless of the what the caravan park may try and say or do, if the caravan becomes someone's 'sole or main residence' (even for a day) then that caravan pitch (and the caravan on it) should be banded for council tax.

Council Tax charges can be backdated as far as the council tax banding has been assigned and, in most cases, the banding is backdated as far as is required to correct the situation. If banding/charges couldn't be backdated the it would be open day for concealment and fraud. In this sort of case the backdating is usually to the date that they can determine the start of the 'sole or main residence'.

The fact that you were not the owner makes no difference where the property was your 'sole or main residence' as you fall liable for the council tax charge as per s6 of the LGFA 1992 during the residence.



On a month by month tenancy you fall liable only whilst resident, outside of that you are not resident - to determine otherwise they must have some suggestion that the liability continues.



My standard advice is to pay the amount and then dispute afterwards. Paying it will head of the liability order but in no way gives any acceptance that would stop it being challenged afterwards. I can't see any obvious grounds for challenging the banding so the dispute would need to be on the council tax side. Once it's paid then a dispute on the specific points of liability would be the way forward - I tend to find that in most cases,a letter setting out the legislation, applied to the actual situation, works.

Confuseddotcom101

Thank you so much for taking the time and trouble to respond, especially as I know that you do this for a living, and we have effectively gained free advice.


Yes, England. I originally put in the name of the Council concerned but my partner told me to take it out, in case they were reading!


I totally accept that the property was our sole or main residence from June 2018-2019, and that as such, any Council Tax liability falls on us for that period. It is not however a caravan, and the new liability has not arisen because the property became our sole or main residence. It has arisen because of the collapse of the holiday park (consisting of blocks of flats/apartments) and three lodges, of which ours was one. Previously the holiday park was either taxed as non-domestic, or a composite heriditament, which is now deemed to have become separate dwellings.


I also accept that from the Council's point of view we are liable as occupiers, whatever the agreement was between ourselves and the owners. I didn't know this previously, holding the mistaken belief that it was the owner of a property who was primarily liable, but this liability would almost certainly be passed on to any normal tenant in the written tenancy agreement. You say that if changes couldn't be backdated, then this would be open day for concealment and fraud. However, it is the responsibility of the VOA to maintain an accurate Council Tax list, and a property doesn't usually newly come into the Council Tax list solely by virtue of it having become someone's sole or main residence. Otherwise, there would be no question of any property, newly built, converted, etc. becoming the Council Tax responsibility of an owner whilst it is unoccupied. I can see that the situation is slightly different for caravans and boats, which are not liable to Council Tax unless they have become someone's sole or main residence. I assume that this is why most caravan parks have an occupancy restriction on them, even though a lot of people may well be using the caravan as their sole or main residence, albeit not for two months of the year, usually between January and March.


With regards to potential concealment and fraud, is the corollary of this that it was our obligation as occupiers to inform the Council when the property became our sole or main residence, despite it not being on the Council Tax list? As I say, I had always assumed in the past that the obligation would fall on the owners of the property to inform the Council of any change of use which may or may not bring a property (back) into the Council Tax list. I only ask just in case this situation arises in the future, although I sincerely hope it doesn't, for us at least.


I have never moved into any property, owned or rented, without checking first to see what Council Tax band it is in, and what the corresponding financial outlay would be, otherwise how do I know if I can afford it? My main issue with the way the Council have behaved is that no-one apparently thought it appropriate to inform us,in advance, that it was proposed to bring the property into the Council Tax list. By their own admission they "visited" the property in May 2019, presumably as a result of a prior appointment with the owners, were informed that we had lived there since 2017 (incorrectly), and then sent the request to the VOA to bring the property into the Council Tax list. I believe that, whatever they may be legally able to do, public officials on behalf elected Councillors have a duty to act reasonably, and in this case they did not do so.


Incidentally, having attempted to read the relevant legislation over the weekend, I see that there is a legal obligation on the VOA to send notice of any alteration to the Council Tax list to the "liable" person for Council Tax. Where the alteration is legally permitted to be backdated, presumably this responsibility also extends to sending the notice to any previous owners/occupiers, (as "liable" people for a particular period) even if occupation/liability for the Council Tax has changed in the meantime, as in our case? As we never received this notice I am unable to ascertain if the reason for the alteration to the Council Tax list legally permits it to be backdated. Am I now within my rights to ask either the Council or the VOA for a copy of the notice?


We will take your advice and pay the amount of £57.65 today. I am however unsure what the next step to take should be. Is this something the Valuation Tribunal can get involved in? Writing to/ringing the Council hasn't got us anywhere so far. I have no idea what the Council think the basis for our continuing liability for the lodge would be. They have openly admitted that their own records show that we have occupied our new property since 21st June 2019. Perhaps they think that we are stupid enough to have a continuing tenancy even though we have moved out. Don't get me wrong, I do blame the owners/ site manager as well in all this, whom I think also had a duty to inform us of what was proposed. It seems that there has been element of collusion, for whatever reason, although obviously I am unable to prove this. Interestingly, the lodge next door to the one which we occupied, which has been occupied as someone's sole residence for the last six years or so, still has not been brought into the list, and the remaining lodge has, but the effective date is May 2019 even though the occupiers have been there since last Christmas. We are the only people who have been stung for charges since March 2019.


The next instalment of £211 (noted on the original demand notice taking us up to March 2020) is due tomorrow. Is your advice also to pay this on time in the hope that the Council will (eventually) see sense and revoke the original bill? If we are legally liable for the period from 15th March 2019 to 20th/21st June 2019 this would amount to a charge in the region of £300, so the first instalment would not technically be an overpayment. If however, they have still not backed down by 1st November we may have to get back to you.:)


Thank you again for taking the time and trouble to read and respond Craig. Does anyone else have any tips/advice for us?

CIS

There is no legal requirement to self declare for council tax (except if a discount or exemption is in place or you've been served a specific legal notice), this also one of the reasons that backdating can take place.


To take it to a tribunal there's a specific route to follow. Always make sure it's done properly, and as in depth as possible, as otherwise you'll have issues (I get approached quite often at the 11th hour to try and sort out a mess).


The notice of banding would just be sent to whoever was responsible for the council tax at the point in time the list is altered, not to a person who would have been liable at a previous point in time. The council tax demands would then be issued under council tax requirements.

lincroft1710

When it is decided that a property is a dwelling for CT purposes, the VOA are required to band it and serve notice of the band upon the current occupier (or owner if unoccupied) at that address. The effective date is either the date of completion (if a new built dwelling) or the date the property became a dwelling. Sometimes the council provide the VOA with the date, other times the VOA has to ascertain the date from information provided and cannot always easily confirm its accuracy, nor are they expected to query the veracity of the information without good reason.

It is not only sole and main residences which are banded, second homes are also banded. So your occupation as a second home could be subject to CT. Possibly not relevant in your case, but a caravan or lodge used as someone's sole or main residence and on a holiday site only open for 10 months of the year would be subject to a CT band.

I have to confess to skim reading your posts as they are excessively long, but I do not believe the VOA have been at fault in the execution of their duties. As you are no longer the occupier of the lodge, you have no right of appealing the effective date of the band.

The VOA is part of HMRC and is independent of any council.

Confuseddotcom101

I can only comment on my own interpretation of the law. Other people's interpretations may well be different, hence why there are so many litigious issues in the world.


As I have said, this matter is causing me an extreme amount of distress, and I would like to think that I have explained why well enough, although I cannot blame anyone at all for skim reading and not picking up on all pertinent points.


I haven't accused the VOA of failing in the execution of their duties. I was merely asking a question about my interpretation of the legislation, whether anyone agreed. Obviously you don't, but having skim read the legislation, I think it is open to interpretation, as is usually the case.


Regardless of what the legal position may be, as I have said I also think that there is a duty on public officials such as the council to behave reasonably. There was no reason why they could not have informed us of what was proposed, (and the date it might have effect from), so that we could go back to the owners and agree a lower monthly rate with them.


I think that as the people served with the Council Tax demand we definitely qualify as "interested people" for the purpose of serving a proposal to challenge the accuracy of the list for the former holiday park, particularly as only certain dwellings seem to have been included.


Whether I get this far will depend entirely on circumstances in the meantime.

CIS

I think that as the people served with the Council Tax demand we definitely qualify as "interested people" for the purpose of serving a proposal to challenge the accuracy of the list for the former holiday park, particularly as only certain dwellings seem to have been included.

Any party who falls within the relevant regulations can challenge the decision to band it however I can't see any scope in this case where the banding decision would be successfully upheld. The term 'interested party' is also defined and doesn't specifically include former tax payers, the phrase used is "...who is a taxpayer".

There is a challenge with the council tax side regarding the period of liability however that is not a VOA function.

lincroft1710

I would doubt that a council has any legal obligation to inform someone that they will getting a CT bill, I believe they are only required to send the bill and by doing anything they are not required to do, they could be accused of wasting public money.

The VOA likewise are only required to serve notice of banding, they are not required to advise that they are considering banding a property. During the 12 years of my VOA career spent dealing with CT appeals I have only vague recollection of twice pre-informing a CT payer and these were both occasions when an existing CT band was to be substantially increased due to a previous VOA error.

Being served with a CT bill does not change your status, only the current occupier can appeal a CT band or the effective date, or the person on whom the notice of banding was served if not the current occupier.

Most CT legislation is not open to interpretation, having been well tested in Tribunals and Courts over the past 26 years.

Other properties not being banded is not a valid reason to challenge a band.

CIS

I would doubt that a council has any legal obligation to inform someone that they will getting a CT bill, I believe they are only required to send the bill and by doing anything they are not required to do,

You are correct.

Confuseddotcom101

CIS, please could you advise the most appropriate way to formally challenge the period of liability on the Council Tax side. Is this done through a Valuation Tribunal? The only other option I can see is to not pay the next instalment (due tomorrow) and challenge the summons in the magistrates court, but obviously we don't really want to do this. Thanks for your help.



I wouldn't be challenging the banding of the property, but putting forward a proposal that the list is currently inaccurate for the former holiday park, as it doesn't show properties which should be included.


Again, I was not stating that I thought the Council had a legal obligation to inform us prior to the banding, merely a moral one and/or a duty to act reasonably. I seem to remember something about the concept of "Wednesbury unresaonableness" from my law school days, but I expect that the concept will be lost on anyone who has not had legal training.

lincroft1710

Confuseddotcom101 wrote: »

I wouldn't be challenging the banding of the property, but putting forward a proposal that the list is currently inaccurate for the former holiday park, as it doesn't show properties which should be included.

Again, I was not stating that I thought the Council had a legal obligation to inform us prior to the banding, merely a moral one and/or a duty to act reasonably. I seem to remember something about the concept of "Wednesbury unresaonableness" from my law school days, but I expect that the concept will be lost on anyone who has not had legal training.

CT legislation does not allow a proposal to be made to include a property in the Valuation List other than by the occupier or owner of that property. Omissions from the Valuation List have no direct bearing on a dwelling that is included. In your case you agree that the lodge was your sole or main dwelling and thus should have a CT band.

The council has no "moral obligation" to inform you of anything prior to the banding.

If you could get rid of some of the emotion and irrelevancies from your posts and also your way forward and just concentrate on purely querying the period of your CT liability, you would be helping both yourself and anyone who tries to read the posts.