Council Tax

[EverHopefull]

I am mid purchase of a bungalow that I will be demolishing to make way for a new dwelling. The property will attract a 2nd home rate of CT rating initially on the purchase completion. 

I read with interest that new builds have to reach a point in development that qualifies them for Valuation and subsequent CT. Based on me planning to demolish, is there a like for like level of services I could remove from the property to make it fall below the requirements for Valuation?

This would be a stop gap until demolishing when I presume the CT liability will cease anyway? 

Anyone had a similar situation?

[ProDave]

This was discussed before and it seems to depend where you are.  In some areas it seems easy to remove a derelict uninhabitable property from the valuation list, others not so.

[nod]

We were informed that Counsul tax was being charged from the day that the roof went on 

and the Counsul were using a rule that stops house builder stock piling unsold properties 

We contacted the valuation team and had our build removed from there register

This infuriated the local Counsul 

In the end comensense prevailed 

and we were given more time 

But it was made clear to us that they could do as they pleased 

But don’t like negative publicity 

[Jeremy Harris]

There is law and case law that determines pretty much exactly when a local authority can and cannot charge council tax on a new build.  In essence, a house can only be charged council tax if it is on the register and has a current council tax banding.  In order to get that it has, by law, to be what's called a rateable hereditament.  There is case law that clarifies what can be a rateable hereditament and what can't.  A house with no potable water supply cannot be a rateable hereditament, for example.  This was the way I avoided our build from getting on the register too soon, I just didn't connect up a tested potable water supply until just before completion.

 

The council can give notice of intended completion to you, which then gives you a period of time before they will start the valuation process, but you can appeal this if you understand the law and case law that applies and can show that the house does not fall within the legal definition of a rateable hereditament.  The law and case law has been quoted on here in the past and is all online and easy to check.

 

This post links to the case law that applies (click the right arrow at the top to go directly to the post):

 

 

This thread is worth a read, too:

 

[Gone West]

They removed our bungalow from the Valuation List once we had the electricity connection removed by the DNO. We used the disconnection documentation as evidence.

[EverHopefull]

Hi, I am ok with the new build property stages and the liability CT wise but I am trying to reduce the CT burden of the current property on the plot that we are going to demolish.

The changes in CT in the last year or so make the old property class as a "Second Home" which actually is just pending demolition.

I guess the obvious choice would be to demolish it and then get it scrubbed from the Valuation?

[newhome]

10 minutes ago, EverHopefull said:

I guess the obvious choice would be to demolish it and then get it scrubbed from the Valuation?

 

What's the status of your planning permission? If it's approved then you qualify for zero rating the demolition work (including things like asbestos removal if applicable). If it's not yet approved then you don't qualify for zero rating (plus I don't think you should demolish before PP is granted?)

 

If it's not useful at all, by that I mean the services connections, storage, a working toilet etc. for the builders to use (assuming the new house isn't going in the same place), probably the best bet is to demolish it asap but check with the council first what will trigger the removal as they may remove it if the services connections are removed as per Peter's experience (although his new house was built by then so they were still able to charge council tax for a house on the plot). Councils seem to vary in relation to their interpretation and implementation of council tax rules.

 

[EverHopefull]

Planning permission has not been granted as yet and the new house will sit in the same area of the plot and hence be totally demolished to allow for foundation works to commence.

The Valuation Office Agency appears to have an office actually in Worthing which seems almost like too much of a coincidence but it does not have a contact number other than a main GOV.UK website displayed UK switchboard number.

 

I guess that Planning Approval will give the zero rated trigger to demolish asap and then de-listing from VOA and CT should be possible....

 

 

[newhome]

55 minutes ago, EverHopefull said:

I guess that Planning Approval will give the zero rated trigger to demolish asap and then de-listing from VOA and CT should be possible....

 

Yep, and that seems the most prudent thing to do. 

 

Still worth checking whether there is something minor you can do to stop the CT though. 

 

Does your LA have CIL in place? If so you can apply to have that invalidated as a self builder (assuming you are going to live in the property for a minimum of 3 years) but you have to apply BEFORE you start any work or you have to pay it. It can be big bucks.