Do Landlords or Tenants Pay Council Tax?

Letting a property comes at a price! Alongside paying for insurance and maintenance fees, council tax can be another expense landlords need to add to the list.

Do landlords pay council tax? Generally, landlords aren’t responsible for paying council tax. But it depends on the circumstances and whether your rental is occupied or not.

In this article, we’ll explain who is responsible for paying council tax and in what circumstances the landlord must pay.

What is Council Tax?

Council tax is a tax used to fund local services and facilities. It's collected by local councils and helps pay for things like rubbish collection, street cleaning, local education, and emergency services.

Here's how it works:

1. Property Bands: Properties are assigned a council tax band based on their estimated value as of April 1st 1991. There are eight bands from A (lowest value) to H (highest value).
2. Charges: The amount paid depends on the property's band and the local council's rate for that band. Different councils set different rates.
3. Who Pays: The person living in the property. In some cases, if the property is rented, the landlord may cover the cost.
4. Discounts and Exemptions: Certain groups can get discounts or exemptions. For example, students, people with disabilities, and single occupants may pay less.
5. Payment: The tax is typically paid in monthly installments over 10 or 12 months. You can also pay annually.

Who is Responsible for Paying Council Tax on a Rental Property?

Most of the time, your tenants will pay council tax. If they are renting the whole property as a sole tenant or joint tenant, the local council will send the bill directly to the tenants to pay. Joint tenants will have the bill split between them.

If your property is occupied by a licensee (which is anyone who lives in the property with permission) or another kind of resident (like a squatter), both types of occupiers are liable to pay council tax.

However, there are some exceptions to this. If any of the following apply, the landlord is liable to pay the council tax:

• The property is empty, and no tenants live there

• The property is a HMO (House of Multiple Occupancy)

• The property is a care home, hospital or refuge

• All occupants are under the age of 18

• All occupants are asylum seekers

• All occupants are temporary residents and have another home elsewhere

Depending on your local council, some other exemptions may apply, so it’s best to check the local authority website where the property resides for a full list of exemptions.

Do Landlords Pay Council Tax When the Property is Empty?

Yes, landlords are generally responsible for paying council tax directly to the local authority when the property is empty. However, some additional exemptions apply that vary from council to council. Some councils will offer discounts for landlords depending on the length of time the property has been empty and the circumstances.

Check your local council website for more information about who pays the council tax when a property is empty, or speak to us at The Letting Experts to find out more.

Are Landlords Liable for Unpaid Council Tax?

Even though you own the property as the landlord, if your tenant doesn’t pay their council tax, you shouldn’t be liable to pay the debts.

The tenants living in the property are liable to pay their council tax and if they don’t pay, the debt is theirs and not yours. This remains the case even if your tenants move out while still indebted to the council.

Get Advice from a Letting Agent

For more advice on how to keep your running costs down as a landlord, The Letting Experts are your local property professionals. Our friendly team of letting agents are here to help you manage your property in the easiest and most efficient way.

Get in touch today for a chat about how our property management services can help. Call 033 33 44 99 15 or email us at hello@thelettingexperts.co.uk.

You may also be interested to read: 7 Steps to Becoming a Residential Landlord

In the meantime, we've answered some of your common questions about council tax payments.

Frequently Asked Questions About Council Tax Payments and Landlord Responsibilities

Is the landlord responsible for the council tax bill in a rented property?

Generally, tenants are responsible for paying the council tax bill as per the tenancy agreement. However, landlords may be liable if the property is empty, falls under certain exemptions, or is a House of Multiple Occupation (HMO), impacting who pays council tax.

What happens if tenants don't pay their council tax?

The responsibility for council tax payments lies with the tenants, and landlords generally aren't liable for unpaid council tax debts. Even if tenants move out with outstanding council tax, the debt remains theirs, not the landlord's, ensuring the landlord isn't responsible for council tax payments.

Are landlords responsible for council tax when the property is empty?

Yes, landlords are usually responsible for paying council tax when the property is empty, and the council tax discounts may apply depending on local regulations. Landlords should check with their local council or consult a letting agent for specific information on exemptions and discounts. Looking to let your property? Request a valuation here.

How is council tax calculated, and are there discounts for landlords?

Council tax is typically calculated based on property valuation and location. While landlords are generally responsible for an empty property's council tax, some local authorities offer a council tax discount based on specific circumstances. It's crucial for landlords to check local regulations or consult a letting agent for details on available council tax discounts.