House with Annex

Partyboy76

Hi, we recently moved into a property that has an annex attached, or aim was to never rent it but for friends and family to occasionally stay. I also work from home in the annex due to Covid.  We have now received a letter from the council stating that because of the increase in the square footage of the property that we are now on an higher council tax banding and additionally they are looking into the fact that there is annex attached to the property. Does anyone know if your local council can increase the banding on the whole property and also charge us effectively again for the annex?

lincroft1710

It will b the Valuation Office Agency (part of HMRC) who deal with CT banding not the council.


If a house was extended by a previous owner, the CT band can be increased following a sale. If the annex meets the criteria for a separate dwelling for CT purposes, it can be assigned its own CT band.


But if the extension was purely the annex, you cannot be charged twice 

sabretoothtigger

Partyboy76 said:I also work from home in the annex due to Covid.  

Its possible to reduce the council tax by excluding the working area but I'm trying to find a thread or article on that in this website if anyone knows the details better

lincroft1710

sabretoothtigger said:

Partyboy76 said:I also work from home in the annex due to Covid.  

Its possible to reduce the council tax by excluding the working area but I'm trying to find a thread or article on that in this website if anyone knows the details better

If there is a dedicated room used solely for business purposes then this could generate a separate non domestic rating assessment and the area of the room removed from the calculation of the property's value for CT purposes which may (or may not) reduce the CT band.


Such occurrences are rare as most rooms are dual purpose, i.e. used as part of the house outside of the "working day". The VOA usually take the stance that unless the business use is blatant, i.e. people coming frequently to the property, other people employed, advertising signs outside etc, the room would be dual purpose. 

pjcox2005

Partyboy76 said:

Hi, we recently moved into a property that has an annex attached, or aim was to never rent it but for friends and family to occasionally stay. I also work from home in the annex due to Covid.  We have now received a letter from the council stating that because of the increase in the square footage of the property that we are now on an higher council tax banding and additionally they are looking into the fact that there is annex attached to the property. Does anyone know if your local council can increase the banding on the whole property and also charge us effectively again for the annex?

Hi, can't answer your question, but just a note that did the annex get taken into account for SDLT purposes when acquired. If it's a separate self-contained anex e.g. bathroom, kitchen, then there would potentially be a tax saving on SDLT by treating it as effectively two properties.