08jan11:00 am12:00 amVirtual EventHMO workshop

Event Details

The government has made legislative changes that impact the Council Tax liability for Houses in Multiple Occupation (HMOs), and we are holding a workshop to discuss.

It started December 1st 2023, and in summary:

  • All HMO’s must be banded as one unit for Council Tax purposes.  Where the rooms have been individually banded (disaggregated), they must now be re-aggregated as one unit.
  • The Council Tax liability for an HMO is now the responsibility of the landlord.

Note, that any property where all the occupants are full-time students the property will be exempt (see dwelling class N in the Act)

Here’s a breakdown of the key points:

  • Changes to HMO Definition:
    • The legislation modifies the Council Tax Chargeable Dwellings order to align the definition of a House in Multiple Occupation (HMO) with the Housing Act 2004.
    • Additionally, it specifies that an HMO must be banded as one unit.  Where a Council has banded individual rooms for Council Tax purposes, it must take steps to un-band them.
      For a licensed HMO this will be automatic.  For an unlicensed HMO the landlord will need to contact the VOA to challenge the current banding.
  • Council Tax Liability for Owners of HMOs:
    • The legislation amends the Council Tax (Liability for Owners) Regulations 1992, establishing that the owner is liable for council tax if the property is an HMO, regardless of whether it is let on a joint tenancy or by the room.
  • Government Communication to Local Authorities:
    • The government has communicated these changes to local authorities through an official letter. This letter clarifies that owners of HMOs are now liable for council tax, and this change is effective from December 1st.
  • Impact on Tenancy Agreements:
    • Despite landlords having the ability to include a clause in the tenancy agreement requiring tenants to pay council tax, the legislative changes mean that if tenants fail to pay, the council can seek payment directly from the landlord.
  • Recommendation for Landlords:
    • The suggestion is made that, given the changes, landlords may find it safer to take on the responsibility for council tax themselves and factor the cost into the overall rent calculation.

It’s essential for landlords and tenants to be aware of these changes to ensure compliance with the updated regulations. Landlords, in particular, may need to review and update their tenancy agreements to reflect the new council tax liability arrangements for HMOs.

More information can be seen here, and in a letter to all Councils.


Virtual Event Details

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(Monday) 11:00 am - 12:00 am(GMT+00:00)

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