Is the council making up student accommodation rules?

Hi Peter

Item (1) - A property occupied exclusively by full time students will be exempt. From the LCC website - "A property that is wholly occupied by full time students will be exempt from Council Tax."

However, by having two agreements, you (or the landlord) become responsible for the council tax. In a HMO, generally, if there is a single AST agreement then the tenants are responsible, when this changes, single room tenancies for example, the landlord is responsible.

That does not mean you have to pay council tax if there is a valid exemption. It is up to you though to furnish the council with the appropriate evidence such as student ID's and proof. In my local council, they waste plenty of time making sure students are eligible, even to the extent of checking with the local Uni to see if they do the required number of hours. If they fall below 'full time student' then they get a bill.

What you really should have done is get the letting agency to change the existing contract by a 'deed of assignment' this will allow the new tenant to take over all of the responsibilities of the exiting tenant and keep the single AST, the council tax responsibility then lies with the residents.

(2) Personally, I would just pay the 16 days as I am sick to death of fighting my local council. Chalk it up to experience, move on and make sure the same mistake does not happen again.

Hope this helps and good luck.

Councils will liaise with the university regarding all students to confirm their eligibility for exemption.
Students are exempt from CT whilst they are students - so if you have second year students for example who are going into third year you're fine - but if you had third year student tenants, CT would become payable once they ceased being students – likely directly after their exams.
If the tenancy is still ongoing during that period post exams, liability for payment of CT lies with the student occupiers. It will default to the owner for the period after the tenancy finishes/is surrendered and before the new one commences.

Peter: 'However, a separate lease has been generated just for that new student.'

I don't understand what you mean by a separate lease. I have been a landlord letting to students for over forty years and occasionally had this problem. My tenants are on a Joint and Severally liable lease, so if one leaves they have to pay up until a new lease is signed or the rest of the group have to make up the rent. I make a new Joint and Severally liable lease which they all sign, and even get new Parental Guarantees which I presume you have. It has been suggested to go for a 'deed of assignment'. This saves getting new guarantees but it's not a wise move as the original guarantors could object to the new tenant so their guarantees could become invalid. I can't see any way the Council could tax the house. I have it in my lease that tenants are responsible if this tax is levied anway. The only time the Council can tax is for one day at the end of the tenancy but that's another discussion!

Reply to the comment left by Yvonne Francis at 29/08/2023 - 12:47
Hi Yvonne

Having a clause in the contract that says the tenants are responsible if council tax is levied will not help you. The council will come after the person or persons liable for the payment of council tax, regardless of what is written in the AST.

With such a clause, you would of course be able to reclaim the cost from the tenant but you would be the person liable to pay the council, not the residents.

In Peter's case, and if he was dealing with my council, he would have to pay council tax and then apply for the exemption and manage the exemption as there is not a single AST agreement.

Council tax is based on a hierarchy of liability. The person nearest the top of the list is responsible, regardless of any clauses in AST's etc:

Hierarchy of liability:
- A resident who owns the freehold
- A resident who owns the leasehold
- A resident who is an assured tenant or is a statutory or secure tenant
- A resident who is a licensee. This means that they are not a tenant but have permission to stay there
- Any resident, for example, a squatter
- An owner of the property who does not live there

Exceptions:
- Where the property is a HMO and tenants have a separate agreement or pay separately for different parts of the property
- Care homes
- etc etc

Hope that helps.

Reply to the comment left by Richard Hemingway at 29/08/2023 - 13:05
Hi Richard
The tenant (or tenants) is responsible for the Council Tax when you rent the whole of the property to one person or family, or to joint tenants. We send the bill to your tenant(s).

This what my council say and my lease is a joint tenancy. I belive it's different if you let single rooms. Even if I was charged I could simply take it from the students deposit. What's the problem?

I can remember once my tenants were billed for council tax because they were in their final year, and of course the lease went beyond their term. It WAS the teants who were billed. They asked my advice, and I said 'keep arguing'. Eventually the council backed off.

1. The student needs to obtain confirmation from their College/University that they are studying there, and that the start and end of the course dates are included and that the course is full-time.

The landlord or letting agent then submits (1) to the Council Tax Department for Council Tax exemption

2. If a final year student is still in the property AFTER the official course date has expired then that student if still resident has to pay council tax as no longer exempt. If the student has vacated then the landlord has to pay council tax for that room until another student has taken up residency AND has submitted the confirmation that they are a student and that has been submitted and accepted by the Council Tax Department

Reply to the comment left by Yvonne Francis at 29/08/2023 - 14:52
Yes, in your scenarios we are in agreement but Peter has a different issue, he does not have a single lease, a separate lease has been created for the incoming student so it is highly likely that he will be responsible for the council tax and for claiming the exemption.

Peter, if you have a joint tenancy and you have issued a second tenancy to an individual for the same space, you have created a legal mess. You would now struggle to take any action against tenants for issues such as non payment of rent, damage to the property, eviction etc.

The correct way to handle this is to either create a new tenancy for the whole group, (including the new tenant), or to do a deed of assignment between the first group and the second.

Reply to the comment left by David at 29/08/2023 - 16:47
Hi David

You have hit the nail right on it's head!

Except I think a new joint lease should be made and not a 'deed of assignment' as I said in my original post.

Reply to the comment left by Yvonne Francis at 29/08/2023 - 17:26
I agree that a new tenancy is cleaner, but my understanding is that if all the tenants are involved in an assignment, the result is lawful. Of course any deposit then has to be dealt with separately. It may also be possible that a clever solicitor could find a loophole for any guarantors involved, so that may also have to be addressed.