Very weird legal letter about council tax arrears?

Very weird legal letter about council tax arrears?

10:36 AM, 30th July 2020, About 4 years ago 19

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Hello, I received a very weird legal letter about arrears in council tax. This derives from a period in which an outgoing tenant did not pay council tax (or rent).

The situation is this. June 2019 no rent received. I chase, but tenants avoid me. The tenant abandons property with lots of mess. Their month runs till 29 June and I get keys back around 27 June, but did not get notice. It is agreed that I keep the deposit as the last month’s rent.

New tenant get keys on 13 July and contract begins 18 July (they get it early).

Question is: Obviously the outgoing tenant is responsible for non-paid council tax till 29 June. They didn’t give notice, but just abandoned the property. Am I, therefore, responsible for the council tax for the empty period?

Finally, when is the new tenant responsible from: the day they took over or the day the formal contract began?

Many thanks


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Ian Narbeth

11:25 AM, 30th July 2020, About 4 years ago

Hi Nav
Short answer is you are liable for the period between 29th June and 13 July when the new tenant moved.
You might have a claim against the Tenant if your lease is worded appropriately. Assuming any deposit is insufficient to cover rent arrears, you are unlikely to get anywhere pursuing this sum.

Gunga Din

11:40 AM, 30th July 2020, About 4 years ago

I agree the tenant should be liable until June 29, as your AST probably states, but if they fled beforehand and registered at another address, whether in the same LA area or not, the council will come after the landlord from the date the tenant said they moved. There is a hierarchy of liability for C Tax, Local Gov't Act 1992, which of course leads to the LL as an easy target, but which disregards the fact that the tenancy still exists.

a) resident freeholder
b) resident leaseholder
c) resident statutory or secure tenant
d) resident licencee
e) any other type of resident
f) owner

I would say giving the keys back is a reliable indicator of end of tenancy for some criteria but as far as the C Tax collectors are concerned, the tenancy ended when the tenant claimed they left the property.

Hartlepool always tell me that :-

During initial fixed term the tenant had a leasehold interest in the property, which is classed as a material interest in the above list.

As a periodic tenancy is a leasehold interest for less than 6 months it is not a material interest for the purposes of sec. 6 of the Local Gov't Act 1992. As a result when property becomes empty, after the initial term, liability for C Tax falls on owner.

On that basis it appears that after its gone periodic, the tenant can end C Tax liability by telling them they're gone, even though the tenancy is still extant with the responsibilities/liabilities which go with it.

I wonder whether contractual vs. statutory periodic makes any difference?

Mick Roberts

12:09 PM, 30th July 2020, About 4 years ago

I have some notes here if anyone wishes to use, I used to get a lot of HB tenants do the bunk & I'd get the Council Tax bills & arguments.
Nottingham Council Tax after having received these notes have generally backed down. People more qualified than me, please correct them as u wish:
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 Valaution 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 perioidic 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.

Chris @ Possession Friend

13:23 PM, 30th July 2020, About 4 years ago

Reply to the comment left by Mick Roberts at 30/07/2020 - 12:09I was going to answer Gunga's point about does it make a difference if Tenancy agreement says that tenancy will continue AFTER the fixed term ends, as CONTRACTUAL, as opposed to the usual previous, Statutory, periodic.
Mick's absolutely spot on.
it was the Broadley case that unfortunately lost because that tenancy ran on as Statutory periodic, which is why the landlord Associations changed their AST's to reflect the tenancy continuing as Contractual periodic.


16:04 PM, 30th July 2020, About 4 years ago

I'm wondering if the fact that the outgoing tenant has agreed (in writing?) that you can use the deposit as the last month’s rent, if the outgoing tenant has unwittingly confirmed the tenancy ended at the end of that month.

Ian Narbeth

17:43 PM, 30th July 2020, About 4 years ago

The issue is between the Council and the Landlord. As Gunga Din has set out there is a cascade of responsibility. This shafts landlords if the tenant leaves early.

Gunga Din

20:26 PM, 30th July 2020, About 4 years ago

Gold Dust.

Many Thanks Mick and Chris.

Dear Hartlepool Borough Council............

Martin Thomas

10:31 AM, 31st July 2020, About 4 years ago

I have student properties let on 12 month fixed term contracts in Bath and in the past 2 years the local council have sent me CTax demands for 1 day (the last day of the tenancy) on 2 of these houses. The NLA referred me to the Leeds Council case (link below for details) and I responded, quoting the case. Bath council insists this judgement doesn't apply because the Local Government Act 1992 takes precedence. So far I have ignored their demands and nothing further has come of it. The amounts involved are very small but as I see it, the principle is important.

Chris @ Possession Friend

10:45 AM, 31st July 2020, About 4 years ago

Reply to the comment left by Martin Thomas at 31/07/2020 - 10:31
Case law 'trumps' ( interprets ) legislation.
Tell them 'go figure.''

Jessie Jones

23:11 PM, 2nd August 2020, About 4 years ago

Local Authorities have discretion to waive the council tax for empty properties in certain circumstances. I have properties in Nottinghamshire, where the Council want council tax from me from the day a property becomes vacant. But I have properties in neighbouring Derbyshire where they will allow a maximum of 3 months of zero council tax in any year, which allows me time to do any repairs and find new tenants. You could try asking your local Council if they operate such a similar discretionary waiver.

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