Double council tax

Mahsroh

Mahsroh said:

I looked into this specifically with the council where I own a rental property (it’s not likely to ever be empty for 2 years but as I’m planning on selling soon I wanted to just check in the unlikely event it would end up empty for more than 2 years). 

The council in question (in England) have a list of exemptions in which they “may” (I stress the word “may”, and they don’t have an obligation to do so) waiver the increase. One of those was that you can prove that you have attempted to sell the property. In other words it’s been the market and you’ve been actively looking for buyers. So worth checking that with your local authority.

But yes, as others have said, it’s very much standard practice now. 

just gone back and checked this. The exact wording (applicable to my specific local authority) is:

3.4 If a person is submitting an application for discount from the long term empty property premium the following will also be taken into account:

• Where the owner can clearly demonstrate ongoing and realistic efforts to

sell or let their property over the last two years since it became empty

This is in a document entitled “discretionary discount policy” though and I guess it’s the wording of “over the last 2 years” that may be a problem as I suspect yours has only been on the market a fraction of that time? So no guarantees, but definitely worth following up with your council I think. They can only say no. 

johnjamesmarsh

Crashy_Time said:

Just get a tenant in ASAP, rent cut if necessary.

Can't. Waiting for a sale to go through just it's at the end of a chain and the solicitors seem to be using Covid-19 as an excuse to go even more slowly than usual

johnjamesmarsh

dimbo61 said:

Council Tax along with other Utility bills are tax deductible expenses from running your lettings business.

So I can deduct them from capital gains if this sale ever completes?

johnjamesmarsh

greatcrested said:

pinkshoes said:

johnjamesmarsh said:

I have a rental property that I took back on 1st January 2020 after the tenant died. It has been unoccupied since 18th March 2019. The council has just doubled my council tax liability as the property has now been empty for 2 calendar years. Is this correct? I have only been liable for the council tax for 15 months during which time it has been renovated then put on the market. Due to Covid-19 it's all taken a long time.

Do I have to pay the inflated council tax?

Why is it not 2 years from 1st Jan 2020? What happened after the tenant died? Why did it take 9.5 months to get the property back? Surely if the property was still under tenancy then the estate of the deceased person would be responsible for council tax until the property was handed back to you?

My guess is that the tenant went into care/hospital whatever in March 2019 and the property was then empty. (Though the tenant (or relatives/POA) could have claimed relief based on going into care I believe- but presumably did not).

When the tenant died in Jan 2020, the tenancy ended and the OP 'took back' the property.

But I may be wrong of course.

Almost. The tenant died but the property was full of his possessions & the family kept paying the rent & bills. They got a 100% reduction for council tax. I took back the property once they cleared it (there was a lot of stuff).

AdrianC

johnjamesmarsh said:

dimbo61 said:

Council Tax along with other Utility bills are tax deductible expenses from running your lettings business.

So I can deduct them from capital gains if this sale ever completes?

Not from CGT. But from your annual profit & loss.

greatcrested

johnjamesmarsh said:

greatcrested said:

pinkshoes said:

johnjamesmarsh said:

I have a rental property that I took back on 1st January 2020 after the tenant died. It has been unoccupied since 18th March 2019. The council has just doubled my council tax liability as the property has now been empty for 2 calendar years. Is this correct? I have only been liable for the council tax for 15 months during which time it has been renovated then put on the market. Due to Covid-19 it's all taken a long time.

Do I have to pay the inflated council tax?

Why is it not 2 years from 1st Jan 2020? What happened after the tenant died? Why did it take 9.5 months to get the property back? Surely if the property was still under tenancy then the estate of the deceased person would be responsible for council tax until the property was handed back to you?

My guess is that the tenant went into care/hospital whatever in March 2019 and the property was then empty. (Though the tenant (or relatives/POA) could have claimed relief based on going into care I believe- but presumably did not).

When the tenant died in Jan 2020, the tenancy ended and the OP 'took back' the property.

But I may be wrong of course.

Almost. The tenant died but the property was full of his possessions & the family kept paying the rent & bills. They got a 100% reduction for council tax. I took back the property once they cleared it (there was a lot of stuff).

So CT was accounted for between the death in March 2019 till Jan 2020 when the tenancy ended.

I'd have thought then that the 'empty property' classification would have started in Jan 2020, sonot yet be 2 years - but I'm not a CT expert.