Council Tax Trebled for Empty Property

Published / Last Updated on 19/07/2018

Tax Advice and Financial AdviceThe Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Bill went before the House of Lords yesterday.  It passed yesterday with only minor wording amendments that were published today and therefore, after these have been approved by MPs and then Royal Assent, it will become law.  It could treble your council tax for unoccupied property.

What’s the ‘soon to be’ Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act all about?

Many local authorities must discount council tax by 50% for unoccupied properties.  The government wishes to encourage property owners and landlords to make unfit and derelict property available for occupation to true and reduce the burden and shortage in the housing market.

Stick and no Carrot.

Rather than using a carrot to encourage property owners, the Government have resorted to some big sticks.  If the property is unoccupied for ever increasing long periods, council tax bills will gradually rise to a staggering 300%.  That’s treble normal council tax rates.

The 50% council tax charge cap will be removed to allow for a new “relevant maximum” council tax charge for any unoccupied property, in short this could be 100%, 200%, 300% or even 500% etc. depending upon government plans at the time.

  • From 01/04/2019 the “relevant maximum” increases to 100% of council tax rate for all unoccupied periods.  In short, there will no longer be any discounted council tax rate for periods of void occupancy.
  • From 01/04/2020 the “relevant maximum” is 100% of council tax rate for properties unoccupied for up to 5 years.
  • From 01/04/2020 the “relevant maximum” is 200% of council tax rate for properties unoccupied for over 5 years.
  • From 01/04/2021 the “relevant maximum” is 100% of council tax rate for properties unoccupied for up to 5 years.
  • From 01/04/2021 the “relevant maximum” is 200% of council tax rate for properties unoccupied between 5 and 10 years.
  • From 01/04/2021 the “relevant maximum” is 300% of council tax rate for properties unoccupied for over 10 years.

Comment

This simply reinforces the Governments desire to make more property available.  In addition, it may even encourage landlords to lower rents to get tenants in or even sell run down and derelict property so that they can be redeveloped for safe occupation.  300% is a big stick.


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