Council tax liability

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This guide will provide information on Council Tax liability and relevant Hierarchy Tenure. This will help you identify the correct liable party.

Council Tax Liability

What is council tax?

Sole and main residence

Joint and Several Liability

House of multiple occupation (HMO)

Leaseholders

Who is Liable?

What we will cover

The Local Government finance Act 1992. Click the blue dot to find out more!

·Council Tax is collected to cover the costs of providing Local Authority services: Education Social Services Lighting Street cleansing Police Services Fire ServicesCouncil Tax is best understood as a cross between a land tax and a personal tax Council tax is based on the assumption that 2 adult’s residents (aged 18 or over) are occupying the property.

What is Council Tax?

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The amount of council tax you pay is dependant on what band your property is in. Council Tax is calculated on a daily rate.

Council Tax Bands

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Who is Laible ?

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The basis on which a person is determind to be the "liable person" largley relies upon a requirement for the liable person to be resident on any day. Liability of an occupied property will in most cases be the responsibility of the resident(s). A resident is a person who is 18 years old or more and who has the property as their sole or main residence. The Liable Party is whoever comes highest on the Hierarchal Tenure List

Deciding who is liable

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A non-resident owner

A resident (including a squatter).

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A resident with a contractual licence to occupy the whole or any part of the dwelling .

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A resident and a statutory tenant

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A resident with a leasehold interest (including an assured tenancy or assured shorthold tenancy)

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A resident with a freehold interest

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Hierarchy of Tenure

Example

This can be a difficult area and in cases where the liability of a property under ‘sole or main residence’ has been challenged at a Court of Law for a decision to be made. Click on the Stars to read about case law.

If a person has only 1 property and this is clearly the property they reside in they will be held liable for council tax. Where a person has more that one home it will be necessary for the Authrity to decide which is their main residence. There are various factors that are taken into consideration to decide this:. Click on the info button to find out.

Sole and Main Residence

Unit 01

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Info

Joint and Several Liability

If multiple adults occupy a property liable for ctax, each individual assumes responsibility for paying the full amount of tax, not just a portion.If one adult fails to pay their share the other occupiers are responsible for covering the full amount due The bill amount is not apportioned (shared) between the parties It is not limited to individuals who are married or in a civil partnership – it applies to any group of adults living in a property regardless of the relationshipThe only exception to this is if one or more are eligible for an exemption or disregard. Where one of the joint owners or occupiers are severely mentally impaired, the SMI person would not be held jointly liable A full-time student that holds a joint interest with one or more non-students cannot be held liable. Click the info button to see an example of how this works.

Unit 01

Each liable party is responsible for full payment of the bill

Only 1 person can be made liable on a bill

Each liable person will only pay their share of the bill

What does Joint and Several mean?

QUESTION

Liability

None of the statements are correct

Ms Munroe owns and lives in a property with her adult son so both are liable for the council tax charge

Mr and Mrs Chaplin live in rented accommodation both are liable for the council tax charge

Which of the following statements is correct?

QUESTION

Liability

Who is responsible to pay the council tax on an unoccupied property?

In most cases where the property is unoccupied because the tenant has vacated the owner/landlord of the property will be nominated as the liable party on the account. There are a couple of execptions to this rule No 1 Leaseholders A leaseholder will normally enter into a lease agreement which is greater than the 6-month period given under the hierarchal table, they will then in some cases look to rent out the property to tenants. So, whilst they hold the lease for any period that the property is unoccupied in between tenants they will be liable for the council tax charge rather than the actual owner of the property and this will continue throughout the duration of the lease period.

Care Homes

Asylum Seekers

Religious Minister Resident

Staff Residence

Houses in Multiple Occupation

Houses of Religious Communities

There are 6 classes of dwellings where the owner will always be held liable for council tax without having to establish the hierarchy these are known as prescribed classes:

When the Owner is always Liable x

The one that we have the most dealings with under the Prescribed Classes is Houses in Multiple Occupation Generally, a house in multiple occupations will be a property occupied by more than one household and more than two people, and may include bedsits, shared houses, and some self-contained flatsA dwelling is classed as a house in multiple occupation if: It was originally constructed, or subsequently adapted, for occupation by more than one household. Each person who lives in it is either: A tenant or licensee able to occupy only part of the dwelling; or A licensee liable to pay rent or a licence fee on only part of the dwelling It may be necessary on any liability disputes to request copies of the tenancy agreements or request an inspection of the property to ascertain who the correct liable party is.

House in multiple occupation - HMO

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Example

• Statutory installment scheme
• Council tax charge starts every year on the 1st April and runs to 31st March the following year.
• Charge payers have a right to pay the council tax charge in instalments over 10 months / 12 months which will usually end in January or March.
• When their liability to pay commences part way through the year the number of instalments is reduced.

Bills and Frequency of Payments

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• Our bank account details for making payments are:
• Bank account name: Salford City Council
• Bank account number: 93073130
• Sort code: 20-54-66
• council tax reference number can be found on the front of the bill and must be entered as the reference.

• Payment plans can be set up - weekly / monthly / fortnightly / annually / twice yearly
• Payment can be made either by: Standing order, Over the phone, Online – on the website using their account number
• Post office or pay point using the barcode on the bill
• Bank transfer
• Cheque

Payment Schemes

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Mr A is nominated as the sole party from 01.02.15 (there is no Single Person Discount on the account)Recovery action is taken at a later date and investigations reveal • Mr A is unemployed• His partner Mrs A has been resident at the property from the same date 01.02.15• Mrs A is in full time employment However because her name has never been included in any notices that have been issued, the liability order has only been obtained in his name. This reduces the recovery options available for us to pursue

Example of Joint and Several Liability

The High Court dismissed an appeal against the decision of the Humberside Valuation and Community Charge Tribunal that a person working in Saudi Arabia should be registered in Hull for the purposes of the personal community charge. The appellant in this case returned home for periods totalling 6 to 9 weeks in a year, his accommodation in Saudi Arabia was provided by his employer and his wife was said to be considering joining him there.Mr Justice Auld concluded that the tribunal’s decision could not be considered unreasonable, particularly given that Mr Ward had security of tenure of his home in Hull but not the accommodation provided in Saudi Arabia..

Case Law Example

Ward v Kingston upon Hull City Council (1993)

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This Council Tax case originated as an appeal against a decision of the billing authority to refuse to award a discount for single occupancy (SPD) but the dispute fundamentally concerned the question of whether Corporal Stark who was obliged to live in service accommodation on a nearby air base was found to be resident in the dwelling which he owned jointly with his wife. Following the principles of the earlier case Potts J said that the factors which pointed to the marital home in Doncaster being Corporal Starks main residence were the security of tenure he enjoyed there, the time spent there when he was not on duty and the fact that he would return there should he no longer be employed by the Royal Air Force.

Case Law Example

Doncaster Borough Council v Stark and Stark (1997)

Refers to the ability to bill more than 1 person for the council tax charge (remember they must all have an equal interest in the property)Examples include;A married couple, or living together as husband and wife, or formed a same sex couple3 people living in a property holding a joint tenancy2 people jointly own and occupy a property 2 people jointly own a property but both live elsewhere

Joint and several liability