As the cost-of-living squeeze continues, council tax is just another expense for property owners. If you’re a landlord, council tax isn’t usually a concern – in most cases, tenants are liable for this cost.
Unless, that is, your rental home is empty for any length of time. As estate agents working with landlords in the east London and Essex areas of Romford, Hornchurch, Dagenham, Rainham, Upminster and Harold Wood, we get a lot of questions about council tax – how to avoid paying it on an empty property being just one.
If you’re wondering how to avoid paying council tax on an empty property, the simple answer is that how much you pay depends where your property is located. Some councils offer exemptions for empty properties but, increasingly, others don’t. We look at the rules around council tax exemptions and find out how the picture varies across east London.
What is council tax?
Council tax is a local tax paid to your council to fund a range of the services it provides. While additional funding comes to the council from the government, your council tax could contribute to anything from recycling and parks to schools and social care. The council tax year runs from April and bills are sent out in March, usually in ten instalments. How much you pay depends on the property’s value band established when the tax was introduced in 1991.
Who pays council tax?
All households with residents aged over 18 are liable for council tax. Discounts and exemptions apply, for example for single person households, students and people on low incomes. In the case of rental properties, it is usual for tenants rather than landlords to pay the council tax bill, but you should make sure this is clear in the tenancy agreement.
Do you pay council tax on an empty property?
According to the government website, you will usually pay council tax on second homes and empty homes, however, it is down to your individual council to decide whether you get a discount. To discourage empty homes, you may be charged an extra council tax premium if the property is unoccupied for more than two years. You may not need to pay council tax while you are carrying out major refurbishments to the rental property.
Do I need to pay council tax on empty properties in east London and Essex?
Havering
For properties in Romford, Hornchurch, Rainham, Upminster and Harold Wood, which fall within the London Borough of Havering, you won’t receive an empty home discount or exemption. Unoccupied and unfurnished properties that have been empty for more than two years will be charged an additional 100 per cent empty homes premium. Find out more on the Havering Council website.
Dagenham
Similarly, in the London borough of Barking and Dagenham there is no discount for empty properties, second homes or properties undergoing refurbishment – unless they are removed from the council tax list because the government’s Valuation Office Agency deems them derelict. As with Havering, a 100% council tax premium applies if the home is empty for more than two years. Read more on the Barking and Dagenham website.
Basildon
In the Basildon Council area, you may be entitled to a council tax discount for empty properties, but they must be unfurnished. This 50% discount is for three months, after which the full rate will apply. If the property is left empty for more than two years, you will be charged an additional premium of 100% of the normal council tax rate. This increases to 200% for properties empty after five years and 300% after ten years. Find out more on the Basildon Council website.
Thurrock
In Thurrock council tax exemptions on empty properties only apply in certain circumstances, such as when the occupier goes into hospital or a care home. Discounts aren’t available because the home is between tenancies or because it is being refurbished. Read more on the Thurrock website.
Why is council tax payable on empty properties?
There is a national housing shortage, particularly in London and the south east, where rental homes are in great demand. Councils have a duty to tackle homelessness in their areas – one way of doing this is incentivising property owners to ensure their homes are occupied, rather than standing empty.
Can I avoid paying council tax on an empty property?
As we’ve said, this really depends on which council area the property is based. In general, it is difficult to avoid paying council tax on an empty property apart from in some specific circumstances – where someone is in prison or a care home or the property has been repossessed or is derelict. Read more on the gov.uk website.
If you are concerned about meeting bills, such as for council tax, should your rental property be empty, another option to consider is a guaranteed rent scheme. ABC Gone offers a guaranteed rent scheme for landlords in London and Essex. We guarantee that your rent will be paid during the period of the tenancy, regardless of whether the property is occupied. Contact us to discuss the scheme or any of our property management services.
