Council Tax / Second home question

[whydontyoucomeovervalerie]

It is a late message from me tonight. Sorry. I am hoping for some advice please.

I have a second home in a London borough. I have had bad tenants before, and because it is a low rent area, with tax changes etc, it is hardly worth it to let it out, so I don't.

I let someone stay there, as i have done in the past, and changed council tax to their name, but they didn't pay it (he was having a rough time), so when he moved out and I saw the letters, I paid and changed the council tax back into my name. He was there for 4 months in total, with a 2 week break in the middle-ish. Council tax dept picked up on it and said they found it fishy that I paid for the council tax and have queried whether it was occupied. They asked for proof of paid rent, deposit protection, deposit taken and tenancy agreement and utility bills. Of course I said I don't have them as it was an informal arrangement. So they have sent me a whopping bill backdating council tax two years as empty and unoccupied. The bill is now about £4000 extra. I'm gobsmacked. They are asking for proof that I don't have and won't have unless I now put a tenancy agreement together, but that is false so i assume fraudulent. Also, I did call them and ask whether I need to change the electoral roll when people come to stay in my second home, or do anything else, and they said no, if it's just a few months and I am helping someone out it's fine. BTW the occupants still pay council tax elsewhere when they stay at my second home and I pay the council tax there. No council tax is being avoided.

I am going to send them the electricity bill, but it will just show low regular payments being paid because of course the place is often empty, just never year round. I stay once a month or so for insurance purposes etc.

Does anyone have any advice for me on how I can satisfy the council that it wasn't empty in a situation like this? I have done this before quite a few times. Over covid my best friend's boyfriend had a mental health breakdown and became violent, so he moved in there until he received medication and stabilised - about 3 months.

I understand it is difficult for them to supervise, but that really isn't my fault.

I totally understand the second home council tax premium will come in next year and of course, I will pay that when I need to, but this is just not accurate and I am not sure how to help myself....

You are illegally letting? You are not complying with letting requirements including safety certificates
are you paying tax on income?
are you allowed to short let in your borough? There are strict rules in most

paying council tax sounds like you are getting off lightly

and if it has a mortgage do they know it is let?
and the freeholder as it may impact on the insurance

if it is ex Social housing then casual letting is usually totally banned and not just restricted

But if no rent is being charged then surely OP is not "letting"?

If you are staying there once a month for insurance purposes, then it's not an empty property.

Yeah came to say this... in our council area you would be due to pay council tax on it if it was habitable (kitchen and bathroom) even if it's empty.

Sounds like a real drain anyway op, think i'd get it on the market in the New Year and recoup some money!

Thank you.

I did not receive money for the person living there, never expected to, never will in future if the person stays there again. The person is known to me. I helped them out. The agreement was they'd pay the council tax. They didn't, so i paid as I knew it was due and wanted to avoid the council hunting this person down with threats. Is that illegal letting? If not, with respect, I'd like to move the question back to what I am asking.

Someone said I'm losing money. I am, and I am not. I am in that it's not being let. The annual profit would be about £1000 per year because of tax changes and being a good landlord is actually a demanding role at times. I have considered selling it, but I've just not made up my mind, and as an investment it's not bad, being property in London, it goes up. Also, as all of the rental income would count as my income I would lose all sorts of benefits and my tax rate would shoot up into the heavens. I don't think I am strange in that I have let someone in need stay there, I think lots of people would do that. It's in a part of town that hosts a famous sporting event each year and my friends regularly stay there for the summer. I then also stay at theirs in NY when they are here. It saves us ££££, and then $$$$.

I am trying to figure out how I prove something has happened in the past, when in the past I didn't know I needed proof so didn't gather the evidence. I get that councils want to make money and everyone is cash strapped, however I should only pay what is right and I shouldn't be penalised for helping someone out, or holiday house swapping or anything like that and I do not know how to satisfy the council on this.

Showing the electricity bills with low usage might help as you suggest, and can you ask the person/people who have stayed there over the relevant period to do a signed /witnessed statement explaining their situation and how you helped them as a friend and didn’t get any rent? Maybe you pay for legal witnessing if needed .

Longer term maybe think about the housing crisis and how it could be a home for someone all the time and think about if you should sell or rent out again. It might not really be cost-effective to save a little staying in NY given the increasing costs of owning, which, as they should be, are encouraging people to keep houses as homes.

Good luck to you. I had a property that was a rental cottage, registered as such. Got divorced and agreed with ex he’d have that one I’d keep the house. He moved in there and he contacted the council to register as living there. Couldn’t as a business property.

Hadvto apply for change of planning permission and divide property legally anyway it took two years and then they backdated the council tax and I got a two year bill one at 100% and one at 200%. Argued with them for ages as it should have been 75% for two years as was occupied. Threatened me with court and I eventually just paid it, still gutted though.

OP - you're allowing people to stay there and asking that they pay only the council tax for the time they are there, is that correct? When there's no one staying there you stay occasionally for insurance reasons because the insurance terms state it cannot be unoccupied for more than, say, 30 days consecutively?

You either properly account for this as a second home or you put proper tenancies in place/holiday let terms in place for those people who stay in it. Other than when someone has a tenancy, an AST or an informal tenancy where they are paying you a regular sum as rent, but don't have a written tenancy agreement, you should pay the council tax on the place. The council tax should be in your name with them making a contribution directly to you, not them taking over the CT bill for a short period.

But the bit I don't understand is that you've said, "BTW the occupants still pay council tax elsewhere when they stay at my second home and I pay the council tax there. No council tax is being avoided." If no CT is being avoided, how come you've received a bill for unpaid CT of £4k? That just doesn't stack up. If you stay however ever often it is for insurance purposes then it's not unoccupied. You can't claim it's empty for however many months when you're going there periodically and staying there, however briefly.

I don't have a great deal of sympathy OP. That's a home someone could be living in full time. If you can't afford to pay what is due for the place then sell it and liquidate the asset instead of fiddling things.

"as all of the rental income would count as my income I would lose all sorts of benefits"

Has no one picked up on this sentence?

Surely if you have a 2nd home you shouldn't be claiming benefits unless they are not means tested!

I did, but the OP may not mean DWP benefits though, it might be tax breaks, etc. I do think it sounds as though the OP is trying to avoid properly accounting and paying for her second home though. Just bloody sell it and let someone else have a permanent home. The whole thing is a bit like when someone has an everyday car and a performance car then moans about the cost of running both, taxing and insuring both. Either you can afford it or you can't, but don't fiddle things/act fraudulently just because you don't think it's fair that the rules state you have to pay for it although you are not actually living there.

Read ... she wasn't letting just allowing somebody to stay.

You’re on benefits but have an empty second home in Wimbledon.

No wonder the benefits bill is so high if people can have second homes and still claim. Something is seriously wrong with this country if this can happen

@whydontyoucomeovervalerie You re being v unwise.
Anyone staying there without a tenancy agreement, even with no rent, could stay there and you'd have to go through the courts to evict them.

TBH You re all thats wrong with this country, asset rich, wont make use of these assets and get either a lump sum or an income BUT claim benefits.

I hope the council get the 4k out of you.

Thanks everyone.

No, I pay council tax all year round, the full 100% which will be 200% from April 2025. I have no problem with paying taxes that are due. I have a problem paying £1000s more. I thought others might have experienced something similar so came on here.

The person who stayed earlier in the year is a family member who had a mental health breakdown. If he wasn't there, he'd be somewhere else costing the council ££££, the NHS ££££, perhaps the police ££££. I have no concerns about him intentionally harming me. I love that I could do that, I have done similar before, and want to continue doing so. Two years ago my friend moved in for a few months when her partner become violent and she needed to get away. There will be other times in the future, and I come from a disadvantaged community where help given and offered is not even.

I don't claim benefits, but I am a single parent and I do have 4 children and benefit from government childcare schemes. So I'd be out £1000s if I lost that. As I said above the profit on renting would be in the low thousands, if that and that's not taking into account maintenance, replacing furniture etc. I could charge more rent, however I only ever charge the LHA out of principle.

I have had a few good responses here, so appreciate that. Thanks again.

presumably you have the property registered as a second home so why are the council now trying to charge the empty home rate instead?

as you appear to know, council tax liability rests with the resident occupier so in the case of someone using it as their main home, whether they pay rent or not, they, not the owner, become the legally liable person for paying the council tax

whilst I appreciate in the current world councils want money for the least effort, but technically by paying their bill for them, the council should have refunded the money to you and gone after the resident instead. Whether a documented or not tenancy is irrelevant, a squatter in residence is liable for council tax before the property owner is, same as a tenant. However, back in the real world, the council want a tenancy document, you could provide one, perfectly OK to let for zero rent. But what will that achieve?

as a single parent you presumably claim single person discount on your main residence and pay under the second home rule on this place, as you appear to suggest, a 100% rate rather than a premium rate (as yet)

I can't see why you should be charged the empty rate since the property appears to still be furnished and so does not meet the definition of an empty property. Bottom line is your liability is the second home rate for the full year, unless the council wishes to legally chase any occupants who used it as their main home for a period, and refund money you paid for those periods.

Your US friends are not main home residents and so they would never be liable. Same with anyone else who has a main home elsewhere in the UK. The "hierarchy of liability" is set out in statute law.

yes the second home rate can rise to 200% from April 25, but until then, on the info you provide, your liability is that of the second home rate, not the empty rate. That is your easy battle, rather than fighting over whether there were rent free tenancies in place at times.

They are letting- they are financially benefitting. Short term lettings is banned or restricted in many/most London boroughs

She is financially benefitting- she is letting- illegally through trying to be smart an thwart the system

She later says that she is charging the LHA rate as well.

Tell the council it will now be an air bnb, needs relisting in non domestic and removing from domestic, if it's your only non domestic premises apply for small business rates relief, nothing to pay

Airbnb is illegal in many boroughs and in almost all ex LA properties- in others it is a max of 90 days a year

"illegal"? ???

No, the law says up to 90 days per year is allowed
if more than 90 days then you would need to apply for planning permission for a "material" change of use.
Guidance on short term and holiday lets in London | London City Hall

Thank you all for your responses

Depends on the borough about the 90 day rule but most are trying to get it completely banned and already don't grant licences to extend.
It is illegal in current or former social housing
It is not allowed in many private mansion blocks under the leasehold and you risk forfeiting your lease.

Chances are that if you are renting an airbnb in London it is an illegal one.

Man, I try not to benefit bash but FML someone on benefits owning a second property in London that's "not worth renting out" officially. Jesus.

Just sell it and let an actual person live there and put your money in a bank where it will get more than £1k a year interest.