Council Tax and Periodic Tenancy

Reply to the comment left by "Robert Mellors" at "29/04/2014 - 23:30":

Very good point Rob. Sounds good argument, on one had the Council telling us we can't go in-, they still have keys, their house. Yet we know they're in their new house.
Yet on the other hand, Council are also saying Landlord have to pay Council Tax 'cause tenant was at new house.

I'm sure the Council will have this base covered, but be good if some legal eagles off here could look into that, as it's gonna' effect more of us Landlords moving on, now we have to pay. What's it gonna' be in 2 years-Landlord has to pay 150% of the Council Tax as soon at it comes empty-Even though we're not aware tenant has done a bunk?

The law on determining liability for council tax states that the test is whether someone is 'resident'.
One can have exclusive possession as a tenant, have the key, and have all of his belongings at one property and not being a resident there.

Caz

You can put what you like in a tenancy agreement, question is whether it is enforceable. If the tenant does not have a legal liablity to pay something in the first place (as opposed to a contractual obligation) making them reimburse a Landlord for anything - unintended HMO creation and fees, Council Tax on vacating, Council Tax because an all student property suddenlty has a worker in it etc - is very difficult.

But at least such a clause gives you a starting point.

There is no argument about a tenant's liability for the rent that is purely contractual. As regards CT I doubt such a clause would hold up.

Note in section 6 of the regs in that post that only a statutory tenancy causes problems. Contractual only mentions licence - not tenancy.

Romain raises an interesting point on "resident". The Regs may not say it but I'd argue that this can be interpreted as having the right to be resident i.e. the tenancy continuing. Problem is the CT office will do the easy thing and bill the Landlord/agent

In response to Romain's comment about it being the "resident" that is liable for the CT, again, there are different interpretations of what "resident" is, depending on the circumstances, and by cross referencing to other legislation you could make a very good argument to counter any council assumption that liability falls on to the landlord.

In immigration legislation, and DWP (benefits) legislation for immigrants, the issue of where someone is "resident" makes a huge difference to what benefits they may be entitled to receive. For people coming to live in the UK they have to be habitually resident here before getting benefits, and this has been determined as not being where they live, but where they have their centre of interest, and evidence of this includes whether they still have a right to live elsewhere, e.g. have a legal right to occupy somewhere else and where they have their possessions etc.

In welfare benefits legislation, again, if someone has keys to a property, has a right to go in to that property (even if only a verbal permission), and has possessions at the property, then they are generally deemed to be living there, e.g. man and woman claim to live apart, but DWP find the above factors then they are deemed to be living together.

In homelessness legislation, if someone has a right to live somewhere and can get physical access, then they are not homeless, i.e. the property is their place of residence so they are not homeless.

I'm sure there must be many other examples of such interpretations of "resident", which could be cited to the Council to establish that the tenant is still liable for Council Tax.

There are lots of examples of caselaw where interpretation of legislation in one area of law if referenced and used in other areas of law.

With all these various areas of law supporting the fact that the tenant can be deemed to be the resident (even if not sleeping there, and with accommodation elsewhere), then it may be worth arguing the point with the council and citing their own policies and legislation (e.g. Councils deal with homelessness legislation, Protection from Eviction Act, environmental health, housing disrepair/housing standards enforcement, etc, etc, all of which are likely to have references to who is deemed to be the "resident").

In addition to all of the above, I would also suggest that you look at how "second homes" are dealt with in terms of Council Tax, as it could also be argued that the tenancy (old one or new one) should be treated as a second home.

No that would make no difference in terms of enforceability of any such clause even if it was in the agreement.

The position though is different where the tenancy is still ongoing. The issue with this Upper Chamber tribunal decision (which has the same strength as a High Court decision but can be overturned on appeal to Court of Appeal or above) is it relates to a tenancy having gone Statutory periodic, because it is a new tenancy. And the tenant could have served NTQ and gone within a month to 6 weeks anyway.

As Industry Observer points out, the Council will go for the easy option of billing the landlord, so don't make it easy for them, use every legal argument possible to stop them doing this.

This includes putting in clauses in the tenancy agreement to make the tenant liable for the CT up to the day they actually return the keys to you and give you vacant possession.

Looked at the Act, and it does define what 'resident' means in relation to CT liability. Quote:
" 'resident', in relation to any dwelling, means an individual who has attained the age of 18 years and has his sole or main residence in the dwelling."

When a tenant moves to another property, I think that there can be little argument that their main residence becomes the new property, though the existing one may remain their secondary residence. The wording used by the judge in the case mentioned above is "cease to actually live" at the property.

This also means that landlords can safely let their tenants go on holidays, as this does not change their main residence.

In my layman opinion, this issue can be taken care of by having the correct clause in the tenancy agreement.
Such clause, and they are common, would not make any difference to the council who would probably still bill the landlord since he would be liable to them, but it would allow the landlord to, in turn, bill the tenant.