Liability for Council Tax – tenant left before contract end?

by Readers Question

14:23 PM, 9th October 2018
About 2 years ago

Liability for Council Tax – tenant left before contract end?

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Liability for Council Tax – tenant left before contract end?

Who is liable for Council Tax if the tenant leaves before the contract ends?

I’m looking for help and advice here from those in the know. I seem to remember a similar thread in the past somewhere on this forum. Any help or advice greatly appreciated.

Using a local Agent for all services, including management, a tenant moved in to one of my properties on the 6th October 2017 using a 6 month AST, although this eventually rolled over for an extra month or two. Unbeknown to me, the tenant had their own house anyway, which was rented out, and when their tenants moved out, they wanted to move out of my property, and so gave one months notice, which meant the tenancy ended on the 5th July 2018.

However, the tenant took back possession of her own house on the 1st July, and used the time until the end of the 5th July to move things out, and clean my property. The Agent came round on the 5th to inspect the property, and take back the keys, which was duly performed without problems, and the new tenant moved in the next day, the 6th, without there having been a void.

it seems that in order to try and reduce her bills, the ex tenant had told Telford & Wrekin Council, plus the utilities, that she had moved out on the 1st July. The Council have since been pursuing me for 4 days worth of Council Tax, £15.45, and despite being informed in writing, by both myself, and the Agent (including copies) of the truth, they will not accept the validity our information.

The Agent informs me that the Council’s policy is now to always accept the tenant’s word as being the truth, and today I have received a Final Reminder, stating that the matter will be taken to Court if I don’t pay! In a reply to the Agent, they say: This is because the liability for council tax is based on the hierarchy of liability as per Section 6 of the Local Government Finance Act 1992. They go on to say:

Guidance Notes:

If your tenant falls into the category of a statutory periodic tenancy and the tenant has already vacated, then the end date of the tenants council tax account will be the date they vacated. Based on the hierarchy of liability as per section 6 of the Local Government Finance Act 1992, as Owner of a property you then become responsible for council tax whilst the property is unoccupied.

Statutory periodic tenancies can exist once the original term comes to an end but the tenancy continues. Where the tenant leaves, with or without notice, in a statutory periodic tenancy, the landlord or owner will become liable from the date that the tenant moves out. If the original tenancy was not renewed at the end of its period, for example the original tenancy was for a period of 6 months and when the 6 months expired a new agreement was not drawn up the tenancy then becomes a “statutory periodic tenancy”.

Then they let you know that they are watching your finances in case you don’t pay:
Telford & Wrekin Council Revenues Services are collecting your personal data for the purposes of collecting any Council Tax and/or Business Rates you are liable to pay and to meet our statutory requirements under the Local Government Finance Act 1992 and Articles 6(1)(c)&(e) and 9(2)(b) of the General Data Protection Regulation 2018 or equivalent United Kingdom legislation.


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21:49 PM, 10th October 2018
About 2 years ago

Unfortunately my council take 8 weeks to process any correspondence by which time enforcement proceedings have started and they inform Council Tax payers they must psy all claimed monies and use the formal appeal process. Hence all this perfectly wise advice about contractual tenancies etc is rendered of no value in practice with my council.

They will also issue with a fixed penalty if you do not notify them within 4 weeks of any change in liability !

Thats why I chase the tenant and claim off them, including for any period which is zero rated because it reduces my zero rated period if the next tenant takes longer than a month to be in occupation - not that unusual either.

Ascertaining the non payment within the deposit notification time period can be tricky so it is best I suppose to get the T to prove payment until their last day of their tenancy.

All this is of course due to the attitude councils exhibit towards landlords.

Chris @ Possession Friend

23:18 PM, 10th October 2018
About 2 years ago

What's your relationship with your properties neighbours like ?
You could ask them if they saw the ex-tenants 'coming and going' moving items in the days leading up to occupation.
There are two different interpretations at play. The hierarchy of Council Tax liability ( especially if AST does not make clear fixed term continues as Contractual, not Statutory or is silent - which is why the main Landlord associations have changed their tenancy agreements to reflect this after the Leeds v Broadley case. ) So you'll loose an argument with the Council, I'd pay up.
BUT, the other legal interest at play, is the tenants liability for the terms of the contract and Landlords reasonable losses.
In this case, I'd either claim against the Deposit, or if that doesn't work, take an MCOL against the Tenant.

Mick Roberts

7:04 AM, 11th October 2018
About 2 years ago

I've not read all your words or comment, quickly looked at Rob Mellors, so if yours is the correct tenancy, these words below win a lot of cases where tenant left & Council try to bill u for council tax.

Regarding your bill for £139.89

Dear Council Tax,

Your bill to me enclosed.

She is was on the periodic tenancy where tenants are responsible for the Council Tax to the end of their notice period.
You did make a mistake on this case: Ac No. xx , & we had a bit of a battle with yourselves, only for you to admit you got it wrong several months later & refunded me the money.

This latest house is same details as the last three we have done.

The outgoing tenants or HB are liable to 14 Mar 2018.

The tenants & HB you should be billing are xx from her overlap.

If you don't agree, please ring me to explain, & do I have appeal rights.

This article applies for properties where the tenant is liable for council tax during the tenancy - so not an HMO.

There has been a lot of confusion about council tax liability where a tenant has left a property, but the tenancy has not been ended by notice (by either the landlord or the tenant), in particular, where the fixed term of the tenancy has passed. Councils appear to have been demanding the council tax from the landlord after the date the tenant notifies the council they have vacated, as a matter of course.

There have been a few Valuation Tribunal decisions, but now the High Court has brought some clarity. You can read about the decision here on Nearly Legal.

The liability for council tax after the tenant has vacated is as follows:

During the fixed term of a tenancy (as long as for 6 months or more) - the tenant is liable until the end of the term (unless earlier termination was agreed by the landlord).

After a six month (or longer) fixed term, where the tenancy becomes a statutory periodic tenancy automatically - the landlord will be liable for council tax after the date the tenant vacates the property. This is because the statutory periodic tenancy is classed as a new tenancy and it is not granted for a period of longer than 6 months - instead being from month to month. So the tenant is only liable for council tax when actually living at the property.

Where a tenancy agreement provides for a fixed term of at least 6 months and then the tenancy continuing on a periodic basis - the tenant will be liable for the council tax until the date the tenancy is ended by notice (landlord or tenant's notice) even after the tenant has vacated. This is because the 'contractual periodic tenancy' is a continuation of the original tenancy, not a new tenancy, and so is a tenancy of more than 6 months.

That issue with contractual periodic tenancies following a fixed term is one that councils have often disputed, but Leeds council appealed the issue to the High Court and lost, so it is now settled. The judgment is Leeds City Council v Broadley [2016] EWHC 1839 (Admin). Any council trying to demand council tax from the landlord in these circumstances should be referred to that judgement.

Council Tax, I am now looking for compensation for my time, trouble, stress, inconvenience etc. This is causing me upset.
At moment, my time has been approx 1 hours @ £150 per hour = £150.

Robert Mellors

9:31 AM, 11th October 2018
About 2 years ago

Reply to the comment left by Mick Roberts at 11/10/2018 - 07:04
Hi Mick

Yes, the Leeds v Broadly case is the one to quote. My earlier comments were simply about have a set of words in the actual tenancy agreement that would make it a contractual periodic tenancy, and I did not really address the issue of how to appeal, so it is good that you have given some sample wording for doing that.

Do you manage to get the £150 per hour compensation for your time spent dealing with the Council's errors? Do they actually pay you this? - If so, we need a chat as to how you managed this as I've never managed to get any council (I deal with eight) to pay for the time/effort I've expended in dealing with council errors.

Mick Roberts

9:49 AM, 11th October 2018
About 2 years ago

Reply to the comment left by Robert Mellors at 11/10/2018 - 09:31Ha ha no, we don't get the compensation money. But if it does drag on, this £150ph makes the managers wake up & if u have to take it to Ombudsman, & u ain't put any monetary figures in your letters at the start, Ombudsman says Well we not awarding u any compensation for losses 'cause u din't ask for any at the beginning, so we assuming u ain't lost 'ote.
I have had council pay me in the past, but I'd guess for the past 10 years or so it's a No No as they also know the Ombudsman had budget cuts & Ombudsman are less likely to take your case on nowadays whereas 15 years ago, they'd take 'em all on. They look for excuse now to not bother.
That's it Rob, council errors. There is new 20 year old workers come in, not got a clue, & they just don't believe that This Landlord may just be right, but Oh no they follow protocol & what the computer says.

Robert Mellors

10:23 AM, 11th October 2018
About 2 years ago

Reply to the comment left by Mick Roberts at 11/10/2018 - 09:49
Oh, that's a shame, if I got even £10 per hour (backdated) for dealing with council errors, I'd be a rich man!


15:25 PM, 13th October 2018
About 2 years ago

These days all of our properties are let via agents on a full management deal.
It's not about the money. it's the principle.
In recent times I have been sweeping through the wording on all of the various tenancy agreements to check for this issue as many (but not all) have still not been updated appropriately.
I have been absolutely flabbergasted by the ignorance and then intransigence on the part of some letting agents when I have approached them to bring their agreements up to date. None more so than the mighty corporate conglomerate of which Reeds Rains is a small part. Not only were the entire staff from top to bottom ignorant of this issue but it took me many hours of email correspondence to finally, at the third attempt, convince one of their senior area letting managers of the point. Unfortunately, this was after enduring many weeks of stonewalling from their legal department (who I was not allowed to contact directly) and exhausting their whitewash of a complaints process.
The senior area lettings manager that did finally get the point did finally accede and agree to represent the matter upwards (via what seems like another 87 or so levels of management as far as I can gather!) but very much with a view that it would probably be best not to hold my breath.
I remain stunned that such a large organisation, legal department and all, can be so spectacularly ignorant.
As observed by said area lettings manager, whatever RR decide to do it will likely be too late for me and he was right. RR's loss is's gain as each of the current tenancies that they manage for us comes up for renewal.

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