Appealing valuation from single to five dwellings?

by Readers Question

15:05 PM, 15th March 2019
About 5 months ago

Appealing valuation from single to five dwellings?

Make Text Bigger
Appealing valuation from single to five dwellings?

We have a small HMO of 5 rooms in Stoke-On-Trent. Recently the Valuation Office has brought our property in as 5 separate hereditaments. The property has been regarded as a single dwelling until 5 months ago, with a tax for the entire property, now 5 times higher.

We have got the HMO license, but 3 out of 5 rooms are on the verge of what can be approved (10m2). 2 rooms are slightly larger about 13m2 and 18m2. All rooms have a minimal en-suite and a small fridge, but no possibility to cook. We have had a hard time renting out due to reduced demand and small rooms and a small shared kitchen. We have had an occupancy of about 3.5 people over time in 5 rooms. The tax must be paid regardless of whether we have tenants, they say. The house has a value of approximately £85,000.

The valuation office made the change without contacting or notifying us, so we had no opportunity to question or give our opinion. We have tried to make contact with them to discuss whether it is reasonable. The Council does not want to discuss or show us the basis for the assessment. They do not allow us to talk to the person responsible. We have submitted, by email, an appeal. They refuse to answer if it is accepted as formally correct, although I have emailed and asked 3 times.

Does anyone have any similar experience or advice on what we can do? Any idea if we have a chance to have our appeal approved?



Frederick Morrow-Ahmed

22:37 PM, 18th March 2019
About 5 months ago

Very sorry to hear about your problems Ulf, Heather, and Harlequin. As Michael said above, it is a worry for all HMO owners.

Did the Valuation Officer (VO) say from what date this would become effective? From the date of his re-banding or can they make it retrospective and charge the landlord a hefty capital sum for unpaid council tax in the past?

Heather, the VOA doesn't have to trawl ads. They can easily access the addresses of all HMOs in any borough, just as you or I can.

I wonder if this would also apply to a resident landlord letting out one or max two rooms (hence not an HMO) to a lodger/lodgers, but with an ensuite and perhaps also a kitchenette?

I think the time has come to jack it in and cease being a landlord. Get out while one still can. I remember what happened to landlords who were hit by the Rent Act 1977. They effectively lost their property.

Harlequin Garden

12:06 PM, 19th March 2019
About 5 months ago

Reply to the comment left by Frederick Morrow-Ahmed at 18/03/2019 - 22:37
As I said the only fair was for this was to have gone with the community charge when the offer was there and everyone paid 'something' - it was set up for situations of shared housing, not that we knew it then. That ship has sailed

The issue I feel we have is that expectations are rising, whilst 40 years ago a grotty bedsit was the starting point of first rental, now very few will/want to pay for anything shared and landlords are only offering what the market is requesting - and this is no sharing or you are right at the bottom of the rental pile. The way forward would be a 'special rate' council tax rate that takes shared houses into account, so it is not splitting the cost of one house which really is unfair for the number of adults, nor the lowest or second lowest band, which is still far too high - the suggestion needs to come from the masses though (trust me, I have said enough about this) with the influx of HMO's this surely has to happen, if any government body is clever enough.

Frederick Morrow-Ahmed

14:24 PM, 19th March 2019
About 5 months ago

Reply to the comment left by Harlequin Garden at 18/03/2019 - 16:41
Harlequin, I got a bit lost towards the end of your first posting. You went through an excellent description of what had happened and then summed up with, for example, that your own HMO Licensing officer had told you that reversing it back to not self-contained status would be very difficult, that your tenants had been very good about it, that the VO just barged in when you were not present (as do EHOs), etc, but then all of a sudden in your last paragraph you wrote that you had SOLD this property and the new landlord was letting to benefit claimants, etc.

Could you please explain this anomaly? Did you actually sell the property that had rooms banded and, if so, is the new owner having to live with the CT banding of rooms? Also, you appear to suggest that not all your units were at the lowest CT Band-A, which would be very surprising. You made an excellent suggestion about having distinct banding for HMOs as a whole houses rather than the individual rooms therein.

Also, did the banding come into effect from the date that the VO made that decision or did they make it retrospective? I have heard that they try to do that although I don’t know on what legal basis. Surely, it is they who originally deemed it to be a single house for CT purpose and it was they who then subsequently changed it. Or, was one supposed to have told the VOA every time one installed a shower cubicle or put in a kitchenette? Most LLs don’t even know of the existence of the VOA, simply assuming that it is all done by the Council. But then, they would argue that ignorance of the law is no excuse.

Harlequin Garden

16:23 PM, 19th March 2019
About 5 months ago

Reply to the comment left by Frederick Morrow-Ahmed at 19/03/2019 - 14:24
Apologies for confusing - The rooms were banded with a couple in a higher band - if they show as over 15sqm (I think this was the cut off, I'm afraid I was switching off very badly at that point) then it is the 2nd band, a couple of mine came up as that but that was because the measurements had been taken prior to the shower rooms put in so pushed them over the edge and were not official floor plans either, they were done 15 years ago for the first HMO license and certainly didn't include the kitchen areas which were there, it was wall to wall. As I said they didn't even poke their head into the rooms to check, they just 'assumed' but assumed correctly that they were pretty much self contained - apart from 2 that had bathrooms on a different floor but they were lumped in with the CT banding - which I would say is questionable as it does not meet the criteria of 'self contained'. The whole house was on one system for heating/hot water, water and electrics. I do think they are making it up as they go along with this 'self contained' business.

They banded them and back dated until the April, they contacted me something like November of that year - so yes they can go backwards and told me they could go back 7 years - how they prove it was in separate units 7 years ago I've no idea but as with all things it's probably for me to prove it wasn't. I paid the back dated and until the new year then did new contracts for the tenants from 1st Jan. As I said it's a damned nuisance getting bills for a day or two days in some cases, I can understand a few weeks but surely it costs them more to bill me for a day than they rake in. I had 4 zero bills a couple of weeks ago, in the same post.

As for contacting the VO for changes, it's no, why would you - but you should be contacting building control if you are putting in new services, kitchens bathrooms, and maybe planning if you are making them self contained - planning will then mark the file and this goes to the VO - none of this applied to me, and I've no idea how they got wind of the self contained units, all tenants were working and none claiming so no cross over there, that is something I'll never know.

I sold as an 'HMO' complete - and the new owner put all the rents up to the LHA so they all had to leave and he's now filled the place with benefit claimants who are the only people who will pay so much for so little - he told me he'd keep the tenants I had and as we all know there is nowhere to go with a liar. There are Landlords and there are those that see it as a money making scheme and take advantage of the disadvantaged and our broken benefits system. A thread for another time.

Frederick Morrow-Ahmed

17:12 PM, 19th March 2019
About 5 months ago

Reply to the comment left by Harlequin Garden at 19/03/2019 - 16:23
You have gone through a nightmare, as have others on this thread (Ulf, Heather). My sympathies and many thanks for alerting us to what is in store for us. I think it is diabolical that they informed you in November and then backdated it to April (plus threatening that they had power to go back seven years). Equally ridiculous that a slightly bigger room can be rated in Band-B. It is only a room after all!

I gather now that you have sold that property you are relieved of further worries on room banding for CT..

I guess one option may have been to stop letting and move into that house yourself as resident owner-occupier.

The most worrying aspect is the so-called “John Laing & Sons” criteria. I quote below from this excellent link


Thus, virtually every HMO let on separate ASTs per room falls into this criteria for individual room banding for CT, even if no works have been carried out to give it any degree of self-containedness!

I am amused that so many LLs are commenting on the Fergus Wilson TV appearance but hardly any on this thread, which is a threat to every one of us.

Frederick Morrow-Ahmed

17:18 PM, 19th March 2019
About 5 months ago

Reply to the comment left by Frederick Morrow-Ahmed at 19/03/2019 - 17:12
Sorry, the contents within that link re John Lyon & Sons seemed not to have printed in my last post. Here it is:

What if it’s none of the above for Council Tax purposes ?

Where a room is not sufficient to be regarded as a dwelling in its own right or as a self-contained dwelling under the Council Tax (Chargeable Dwellings) Order then it may appear that all your problems are resolved however this is not always the case. There is a third issue which needs to be considered and we will look at this next.

What is ‘John Laing & Sons’ and how does it apply to HMOs and rooms?

John Laing & Sons is a 1949 case which has been most commonly used in respect of Non Domestic Rates cases however the applicability to Council Tax has been determined previously via Valuation Tribunals. In this particular case the court set out 4 main aspects to consider for ‘rateable occupation’ to occur, that the occupation should be beneficial, exclusive, actual and non too transient. Where these aspects are met there is occupation sufficient to warrant its own Council Tax band – even if it is just a single room.

Valuation Tribunals have on occasion found that the 4 aspects required for ‘rateable occupation’ are also valid case-law with regards to Council Tax occupation of a property. This means that, under Section 3 of the Local Government Finance Act 1992, anything which meets the definition of a dwelling is liable to be individually banded for Council Tax purposes and there is no need to consider any aspect of self-containment in this decision.

In a 2016 example a landlord who ran a HMO with a range of rooms (some which may arguable have been ‘self-contained’ units) appealed to the Valuation Tribunal after the Valuation Office determined that each room would fall as a ‘dwelling’ by virtue of John Laing & Sons.

On appeal to the Valuation Tribunal they found that the Valuation Office were correct and that the HMO should be split in to a number of individual dwellings based on the tenancy agreements which were in place. Each dwelling was then banded for Council Tax purposes – the Council Tax HMO status would then need to be re-determined on each ‘new’ dwelling and liability ascertained.

Frederick Morrow-Ahmed

11:22 AM, 20th March 2019
About 5 months ago

Reply to the comment left by michaelwgroves at 18/03/2019 - 11:24Hi Ulf,
I am a bit confused. In your main post your write "All rooms have a minimal en-suite" but in your subsequent comment you say "In my case I have no on suit". So which is correct?
But regardless, it must be a huge worry for you. End of the day, it is still just a house, albeit containing bedsits. And why should the VOA make this change without consulting you, and then refuse to discuss the matter with you. Seems very high-handed to me.
I am not sure if you are a member of the NLA or RLA but this is something that these landlord organisations need to be taking up urgently


11:33 AM, 20th March 2019
About 5 months ago

Reply to the comment left by Frederick Morrow-Ahmed at 20/03/2019 - 11:22
I think you are confusing Ulf and I, two different people.

Frederick Morrow-Ahmed

12:06 PM, 20th March 2019
About 5 months ago

Reply to the comment left by michaelwgroves at 20/03/2019 - 11:33
Oh, sorry about that! Thanks for enlightening me.

Frederick Morrow-Ahmed

12:07 PM, 20th March 2019
About 5 months ago

Whatever the rights and wrongs of this, I can see two objections.

As Heather says, it is the underhand (and high-handed) way that it is being done and, in Harlequin’s case, the threat to GO BACK 7 YEARS IN BACK COUNCIL TAX!

From where do they get this right to make this retrospective? Surely it was they who set the original CT band for the property as a whole house and it was they who then subsequently changed it to separate banding for each individual room. The landlord paid the CT as originally demanded by the VOA and is then liable to pay the CT on each room FROM THE DATE THAT THEY MADE THE CHANGE.

Going back in time when the landlord was paying as demanded by them seems to fly in the face of natural justice.

If any of the affected is a member of the NLA or RLA it is something these landlord organisations need to take up urgently.

1 2 3

Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?



Police blamed for allowing Anarchy to rule in the PRS

The Landlords Union

Become a Member, it's FREE

Our mission is to facilitate the sharing of best practice amongst UK landlords, tenants and letting agents

Learn More