In the United Kingdom, council tax is a local tax levied on domestic properties to fund essential services like waste collection, street cleaning, and local libraries.
While council tax is usually associated with occupied dwellings, the issue becomes more complex when empty properties are involved.
How Long Can a House Be Empty Without Paying Council Tax?
Council tax bands determine the amount of council tax a property owner pays. These bands are set nationally but applied and collected by local councils.
Properties are valued and assigned a band (A-H) based on their market value on a specific date.
Higher-value properties fall into higher bands and consequently incur a higher council tax liability.
For the most part, council tax is charged on all domestic properties, regardless of occupancy status.
However, exceptions and discounts are available for unoccupied properties that meet specific criteria.
You must understand these exceptions and the relevant time frames to ensure you are not paying council tax unnecessarily.
Do I Get a Discount if My Empty Property is Furnished?
Some councils offer a council tax discount for furnished and unoccupied properties. The discount can be as high as 50% compared to the standard council tax rate.
The rationale is that a furnished property will likely be reoccupied soon.
However, the availability and extent of this discount depend entirely on your local council’s policy.
When Do I Start Paying a Premium on Council Tax for an Empty Property?
If your property remains unoccupied and unfurnished for two years or more, you will incur an empty dwelling premium. This premium is essentially a surcharge for your standard council tax bill.
The exact premium amount differs but can be as high as double the average council tax rate.
This premium is intended to encourage owners to rehabilitate empty properties and address the national shortage of available housing.
Can I Avoid Paying Council Tax Altogether if My House is Empty?
Generally, no. Council tax liability for an empty house arises when the property is unoccupied and unfurnished.
However, there are some exceptions and potential discounts to consider:
- Short-Term Exemption: Most councils offer a short-term exemption, usually lasting for one month, following a property becoming vacant. This grace period allows time to find new tenants or sell the property without incurring immediate council tax charges.
- Empty Properties of Deceased Estates: If a property remains empty due to the recent passing of its owner, council tax is generally suspended until probate is granted. Following probate, some councils might offer a six-month exemption, provided the property remains unoccupied and in the deceased’s name.
- Furnished Properties: While uncommon, some councils might discount council tax for empty furnished properties. Contact your local council to inquire about their specific policy.
What if My House Remains Empty for More Than a Year?
After the initial exemption or grace period for a deceased estate, you will be liable for total council tax on the empty property.
However, no further discounts or exemptions are based solely on the duration the property remains unoccupied.
Are There Penalties for Long-Term Empty Properties?
Significant financial penalties exist for empty and unfurnished properties for extended periods.
These penalties, known as empty dwelling management charges (EDMCs), are designed to discourage owners from keeping properties vacant and increase housing availability.
- Long-Term Empty Premium: After two years of being empty and unfurnished, the council can charge up to 50% premium on top of the standard council tax amount.
- Premium Increase for Longer Vacancy: This premium can rise further for empty properties for even longer durations. After five years of vacancy, the council can charge double the standard council tax rate, and after ten years or more, the charge can reach up to four times the standard rate.
Are There Any Exemptions for the Empty Dwelling Management Charge?
While the financial incentive to bring empty properties back into use is clear, there are some exemptions for the EDMC:
- Properties Undergoing Major Repairs: If a property is undergoing significant renovations that render it uninhabitable, you might be eligible for an exemption from the EDMC. However, you must provide evidence of the repairs and their duration to your local council.
- Properties Linked to Another Occupied Dwelling: An annexe or outbuilding attached to your primary residence might be exempt from the EDMC if it remains unoccupied.
- Armed Forces Personnel: If you are a member of the armed forces required to live in military accommodation, you might be exempt from the EDMC on your previously occupied property.
What happens if my house remains empty for an extended period?
If your property stays unoccupied for more than the short-term exemption period (usually one month), you’ll be liable to pay council tax at the standard rate. However, things become more complex after two years of vacancy.
After two years of being empty and unfurnished, your local council may issue an Empty Dwelling Management Order (EDMO), which empowers them to take control of your property, find tenants, and collect the rent.
The collected rent would cover council tax, management costs, and outstanding bills.
To encourage the return to use of empty properties, councils can impose an additional council tax premium on houses that have been unoccupied and unfurnished for two years or more.
This premium is currently set at a minimum of 50% on top of the standard council tax rate.
The premium can be increased further, depending on the duration of the vacancy.
For instance, if a property has been empty for five years, the council can charge you double the standard council tax rate (100% premium).
There’s no upper limit on the premium for properties empty for ten years or more, meaning you could be liable for up to four times the standard council tax rate.
Your local council website is the most reliable source for information on council tax bands, empty property policies, and exemption applications in your area.
Also, the UK government website will provide you with a guide on council tax for second homes and empty properties.
