Propertymark supports Welsh government’s proposal to simplify council tax for HMOs

An industry body has welcomed the Welsh government’s proposal to reform the “unfair” way HMOs (Houses in Multiple in Occupation) are charged for council tax.

Propertymark has praised the Welsh government’s proposal to only charge HMO’s council tax as a single property rather than per occupant which they say will help make the system less complicated.

Under the old system, where council tax was split up and billed for each unit in an HMO, tenants ended up paying more than others on the same street.

In England, all HMOs are treated as a single property for council tax purposes.

Needs urgent reform

Propertymark says that by combining the council tax bills for each HMO into one, the system will be simpler.

It will also allow landlords to pay the bill and then include a portion of the cost in the rent for each tenant, instead of dealing with the confusion of separate bills being sent out.

Tim Thomas, policy and campaigns officer at Propertymark, said: “The existing system that results in council tax being split up needs some urgent reform as it leads to each HMO unit being regarded as a separate dwelling.

“We then end up with a disproportionate billing system, where contract holders are paying more than other residents in the same area.

“Furthermore, local authorities should be prohibited from charging landlords council tax even after the tenant has moved out with no forwarding details.

“It would be better if the burden of council tax was eased for contract holders as a result of the suggested changes from the Welsh government, as HMOs become a very popular and affordable choice for low-paid contractors or those receiving means-tested benefits at a time when people are already struggling with expensive bills.”

No way to recover the charges

Propertymark also wants the Welsh government to stop council tax bills from being re-banded retroactively and charged to landlords, especially when tenants have moved and there’s no way to contact them to recover the charges.

They also say the Welsh government, the Valuation Office Agency, and local councils need to communicate any changes that property agents and landlords need to know about.

Propertymark also suggests that if the proposal goes ahead, the Renting Homes (Fees etc) (Wales) Act 2019 should be updated so landlords can charge tenants for the cost of council tax as a permitted payment.

The industry body says this would make sure landlords can get reimbursed for the council tax cost, and it should be fairly split between tenants.

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