I own a 3 bed flat which I rent out to University students on a single 12 month AST (the tenancy agreement asks for each person’s student id and place of study). On this basis the agreement states that council tax (along with other utilities) is the ‘Landlord’s responsibility’ as the property will be exempt from council tax provided all 3 tenants are full time students for the duration of the tenancy agreement.
This has never caused a problem as each year the different tenants have been given the exemption by the council. However for this year (the tenancy agreement runs from 25th July ’16 – 24th July ’17) I was notified only half through the tenancy agreement that not all 3 tenants were students, in fact only one of them was a part time student, one other did not start their course at all and the final one graduated in December.
None of this was made clear to me as the landlord until well into their tenancy agreement. Therefore the property is no longer exempt from council tax and as it is classed as a HMO from the Local Authority this liability falls on me as the landlord.
Obviously with the property and tenancy agreement being aimed specifically at students I have not factored in the cost of council tax into their rent. I have therefore had to foot the cost of the council tax for the duration of their tenancy agreement whilst asking them to reimburse me this cost (and to no avail at present).
Bearing in mind that the wording of the tenancy agreement is not ideal (there is no mention of notifying the landlord of change of circumstances and no longer being students), is there any way I could pass this cost onto the tenants e.g. amending the contract in light of their change of the status to non-students and increasing the rent due or deducting an amount from their deposits?
It is also worth mentioning that they have now paid in full for the whole tenancy period (ending 24th July 2016).