Property investors face a new £420 million tax blitz

Property investors face a new £420 million tax blitz

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Property investors face a new £420 million tax blitz

Landlords and second home owners who leave their properties standing empty face a new tax blitz.

The government is to introduce proposals to let local authorities raise an extra £420 million a year in Council Tax from homes left vacant for more than two years and second homes only used at weekends.

The ’empty homes premium’ penalises property owners who can currently claim Council Tax discounts for under-use.

The government estimates more than a million homes stand empty for most of the time which could clear half the families from council waiting lists.

“We’ve lived with the scourge of empty homes for too long,” said Andrew Stunell, the Lib Dem communities minister.

“They’re a blight on our communities and a waste of much-needed housing. It’s madness that councils have been forced to offer discounts on empty and second homes, which don’t take into account local circumstances and provide an incentive to leave homes vacant indefinitely.”

Councils are urging the government to bring in the new charge to counter falling council tax revenues to pay for services.

In holiday home communities, like Cornwall and the Lake District, many homes are empty while councils struggle to find the cash to pay for essential services.

Last year, 246,000 properties were eligible for a second-home discount of 10 to 50%, costing councils £42 million.

Cornwall loses the most to second-home owner discounts at £2 million a year.

Leeds City Council is the biggest local authority empty homes loser, with an £8.5 million a year council tax shortfall.

Nationally, lost council tax on empty properties adds up to £382 million a year.

Stunell also threatened to “clamp down hard on landlords who leave homes empty for long periods” by increasing the amount of Council Tax they pay on houses and flats.



Comments

6 years ago

I always thought that Council Tax was raised to pay for essential services USED by the resident. If there is no resident, then no services are being utilised by the non occupants. Bins dont need emptying, etc. BUT the owner STILL has to PAY for a minimum of 6 months Council tax irrespective of the cost to the council. Forcing owners of empty houses to make the houses available to homeless families will only be fair if the state bankrolls the rent securely to the houseowner, with direct payments to them. Any other method will be tantamount to making the plight of the homeless the responsibility and burden to second home owners, forcing them to accept risks with their property letting to people who they wouldnt normally consider, while lining the coffers at the Councils without having to provide the services. By the way I am a Landlord and all our houses are fully let except when empty for refurbishment ,and I dont expect to pay Council tax during void periods.

6 years ago

There is a great difference between homes left vacant as a deliberate policy by the owner and homes temporarily vacant whilst the owner seeks a new tenant.Also holiday homes which are used by families on an irregular basis, often over several generations. They pay their council tax, maintain their property and are generally excellent neighbours. Beware the politics of envy and remember the fable of goose and golden eggs.

6 years ago

What did happen to this goose and egg(s), I've forgotten, put it here.

6 years ago

Just to put the alternate view; there is surely an infrastructure cost to most services to be on standby. Street lighting, refuse collection, emergency services, road maintenance for example, are all available 24/7/365. For property owners to be paying up to 50% less in council tax and still expect these services to be fully available whenever they are in the area must have a knock on impact to the quality of services available to permanent residents in the area year round. I am not anti holiday homes and I do not like the implied idea that private properties are somehow a lost national asset, but I do think owners have a responsibility to the community as much as they do in their permanent residence. The street lights don't turn off and the police do not ignore a report of a burglar just because no-one is home.

6 years ago

As usual, the easy prey of 2nd holiday home owners has come up again. Whilst landlords should not leave property vacant & avoid council tax, the Govt must surely realise that most people who own 2nd homes spend their hard earned cash in the local community and not abroad. You have to remember that all those people who have 2nd homes abroad are not spending any cash in the UK only the flight taxes to get to their place in the "Sun" !!

The other thing is that because people are not using the holiday homes full time they are not utilising all of the local council services.

I am sure if you conducted a survey of local businesses in places like Cornwall etc, you would find they are very reliant on the holiday home people for business @ the weekends etc, Butchers, Bakers, Pubs, Hotels, Restaurants etc to name but a few!! Another example of an easy fix for Govt.
How about tacking the real issues like benefits fraud, & other welfare assistance that seems to be given out without proper checks !!!

Mark Alexander

6 years ago

But how will all this affect the sale of static caravans and pasties? !!! LOL

Michael Holmes

6 years ago

It always amazes me how much air time is given to all these lefty useful idiots whenever the subject of empty houses comes up. Nobody ever seems to correlate the influx of 250000 extra people each year into the country with a housing shortage.  If all these chumps, supposedly in charge of our borders, addressed immigration properly, instead of wringing their hands over the poor legions of un-housed, then this problem would vanish overnight. Talk about fiddling while Rome burns!  Give us all a break for pities sake.

6 years ago

So are you saying stop all immigration, get rid of the EU migrants thereby releasing 21/2 million jobs back for British workers., that takes care of unemployment largely!
Then there would be a similar availability of accommodation.
Introduce an Australian type immigration system.
Stop all Commonwealth immigration unless the skills they have are NEEDED.
It seems so simple to do, I wonder why it won't ever be done.
Which is why there will be a continual housing crisis.
Lets say  build 250000 new properties.
Immigrants will take those.
The following year you build another 250000 properties, immigrants take those.
Can't see how how things are to be addressed until UK states we are closed presently and will open up again when WE deem it appropriate.
Chances of any of this happening
ZERO!

6 years ago

This will discourage real estate investment and is a continuation of the governments policies on discouraging the real estate  investors.

Michael Holmes

6 years ago

I am not suggesting anything as draconian as your article portrays,merely that we install some sort of usable border controls similar to those that existed before 1997 when the great Blair disaster befell us. I think at that time, nett immigration was running at around 50000 a year. That was still too high, but at least nearly manageable. This would of course require control of inter-European as well as Commonwealth immigration.  This could be achievable fairly soon if the breakup of the EU goes according to expectations. I can't see any reason why this would not precipitate the retrieval of most of the sovereignty our wonderful politicians have 'shared' withour european neighbours.

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