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Council Tax on Properties set aside for demolition

Submitted by VickyLJackson on 8 December, 2011 - 10:45

Hi

I have been asked by one of my colleagues in Regeneration if any other Authorities Council Tax Division charge for empty properties that have been set aside for demolition? 

Also does anyone has information that states empty homes that are set aside for demolition are exempt Council Tax could you please let me know.

Thanks

Vicky Jackson

vicky.jackson@stockton.gov.uk

 

 

 

 

 

 

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HiI queried properties

Submitted by K Alcock on 12 December, 2011 - 11:13.

Hi

I queried properties earmarked for demolition or renovation with my council tax department a couple of weeks ago and was told that they cannot be exempt from CT until demolition or renovation works start.

I got the impression that this is a universal rule to which they are required to adhere and not just the decision of my council.

hope that helps

Kathy Alcock

 

 

Kathy Alcock Housing Policy & Initiatives Tunbridge Wells Borough Council

Council Tax Exemptions

Submitted by CJones on 13 December, 2011 - 11:46.

Our Council Tax department has always exempted properties earmarked for demolition. I think that this is probably correct in most cases, but will depend on the circumstances of the individual case. To support this view, I would point firstly to the Directgov web site, which includes in its list of properties exempt from Council Tax properties:

"that are kept empty because they have been compulsory purchased and so will be demolished"

Secondly, the Council Tax (Exempt Dwellings) Order 1992 describes Class G exemption as

"an unoccupied dwelling the occupation of which is prohibited by law, or which is kept unoccupied by reason of action taken under powers conferred by or under any Act of Parliament, with a view to prohibiting its occupation or to acquiring it;"

This seems to me to be quite a broad description, referring as it does to action taken under any act of Parliament (my emphasis). To my mind this would include voluntary acquisitions prior to a CPO taking effect, or any acquisition achieved as a consequence of starting to use any statutory powers.

Obviously there is some room for interpretation, and the outcome will depend to some extent on how helpful or obstructive colleagues wish to be, and on custom and practice in individual authorities. However, I think that there is a very strong case for exemption in most circumstances.

Chris Jones

Barrow Borough Council

Comments from Council Tax

Submitted by David Gibbens on 15 December, 2011 - 12:00.

I received these comments from Glyn Berrisford, Senior Revenue Officer at Stoke City Council

The phrase 'set aside for demolition' is not one that fits easily into CTax legislation. Generally I think this will be around CPO/renewal areas, where areas of a City are being demolished.

I think this may also refer to a Class G exemption - Occupation Prohibited by Law. This can apply where a property is in the process of being Compulsorily Purchased by a Local Authority.

If the dwelling in question is an empty property then the Class G exemption can be applied from the date the 2 parties, the Council and the Owner, enter into negotiations. This will apply for the duration that the purchase process is ongoing. Once purchased then the Council owns the property, and the Class G should end. This may be when the charge becomes due again unless the authority were to serve a Prohibition Order on itself forbidding occupation of the property. If such a notice was served then Class G would apply again as occupation of the property was once again prohibited by law.

As you say most authorities will award Class C, or look to get the property taken out of the Valuation List. An authority could also use Class A. Class A would run from when the property became uninhabitable; it may be that the property was habitable, but then works done following CPO may have rendered it uninhabitable, in which case a Class A could apply from when it became uninhabitable.

Alternatively authorities could use Section 13A of the LGFA 2003 which allows the awarding of reductions at its discretion. (Though the creation of criteria by an authority to enable it to grant an exemption to itself may be considered a bit 'iffy', given that the funds to meet a Section 13A award have to be met by the rest of the taxbase) - in essence every taxpayer would be paying a little extra so that the council could have an exemption.

13A Billing authority's power to reduce amount of tax payable

(1) Where a person is liable to pay council tax in respect of any chargeable dwelling and any day, the billing authority for the area in which the dwelling is situated may reduce the amount which he is liable to pay as respects the dwelling and the day to such extent as it thinks fit.

(2) The power under subsection (1) above includes power to reduce an amount to nil.

(3) The power under subsection (1) may be exercised in relation to particular cases or by determining a class of case in which liability is to be reduced to an extent provided by the determination.

David Gibbens (EHN Policy and Support)