A landlord’s liability for council tax is quite tricky to figure out and navigate.
This is a practical guide that explains who is responsible for paying council tax when a landlord lets a property to tenants, including students, HMOs and single lets, and what happens when the tenants leave before the end of their notice period.
I also explain how liability for council tax changed when the Renters’ Rights Act came into force on 1 May 2026.
For guidance on every stage of a tenancy in compliance with the Renters’ Rights Act, buy my bestselling book, The Good Landlord Handbook on Amazon.*
Who pays council tax in the private rented sector?
Council tax liability for single lets
If a landlord lets a property to a single household or two sharers, the effect of section 6 of the Local Government Finance Act 1992 is that the tenants who are “resident” are responsible for paying council tax, and not the landlord. A tenant is “resident” if they are an adult and the property is their sole or primary home. If there is more than one tenant, such as a couple, they are jointly and severally liable for the council tax.
Who pays council tax for HMOs: landlord or tenant?
It is the owner of an HMO let by the room who pays council tax, and not the tenants. The definition of HMO for council tax is slightly different from the usual definition under the Housing Act 2004, and is in the Council Tax (Liability for Owners) Regulations 1992. The definition of an HMO for council tax purposes is a dwelling where the tenants or licensees only have the right to occupy part of the dwelling, or aren’t liable to pay rent or a licence fee for the whole dwelling.
For an HMO let as a joint tenancy, on the other hand, the tenants are liable for council tax as they have the right to occupy the entire dwelling, and not just a room.
The Council Tax (Chargeable Dwellings and Liability for Owners) (Amendment) (England) Regulations 2023 clarified that HMOs are to be valued as a single property for the purposes of council tax. This means that the Valuation Office can no longer disaggregate or split HMOs into single units, so that council tax is payable for each room rather than the whole property. The Explanatory Memorandum says that the Regulations “will ensure that an HMO has one council tax band and receives only one bill.”
These regulations adopt broadly the same definition of HMOs as those set out in Section 254 of the Housing Act 2004, but exclude a converted block of flats covered by Section 257 (that’s the reference to Section 254(1)(e) below) and properties in Schedule 14.
‘HMO” means a building or part of a building which is a “house in multiple occupation” as defined by section 254 of the Housing Act 2004 but as if subsections (1)(e) and (5) of that section were omitted;”.
This means that the landlord is liable to pay the council tax for Section 254 HMOs, and the HMO will be one property for the purpose of council tax, and can no longer be disaggregated into single units. Section 257 converted flats aren’t affected by the regulations.
>> Related Post: What landlords need to know about HMOs
>> Useful Resource: DLUHC Information Letter of 8 November 2023
Students and council tax
Full-time students at college or university are exempt from paying council tax. If everyone in the property is a full-time student, no council tax will be payable. If the student lives with others who aren’t full-time students, the others will need to pay council tax. However, the full-time student is disregarded for calculating the council tax.
For the reasons discussed above, if it’s a joint tenancy for the whole property, the tenants are responsible for paying council tax. If the rooms are let individually, then the landlord is liable.
Who pays council tax if tenant leaves before end of notice period?
Before the Renters’ Rights Act came into force on 1 May 2026, this was a complicated question to answer, but this has now been simplified. Under Section 28 of the Renters’ Rights Act, tenants are now liable for council tax from the start until the end of the tenancy, which means the end of the notice period, where they have served notice to quit to end the tenancy.
This is because Section 28 changed the definition of “material interest” in Section 6 of the Local Government Finance Act 1992 to include an assured periodic tenancy, which replaced assured shorthold tenancies.
Consequently, the artificial distinction between contractual and statutory periodic tenancies has now gone. Tenants who let a whole property are now liable for council tax until their notice to quit expires, even if they move out earlier.
Does a landlord pay council tax during voids?
Yes. When a property is empty, the landlord is responsible for paying council tax. However, some local authorities give landlords a grace period after a tenant moves out during which they either don’t pay council tax or they receive a discount. Others charge the full amount from the day the tenant or previous owner moves out, in order to encourage landlords to let the property as soon as possible.
For instance, my local council, Maidstone Borough Council, charges the full council tax for empty properties, regardless of whether they are being refurbished. There are no relevant exceptions for landlords or other property investors. The policy is the same for furnished and unfurnished properties.
Oxford City Council has a different policy that is more supportive of landlords and investors. Owners of empty unfurnished properties have one month’s grace period where no council tax is payable. If the property is undergoing major works and/or structural repairs, there is a 25% discount for up to 12 months, followed by the full charge.
However, if the property remains empty and unfurnished for two years, without being refurbished, the council adds an empty home premium of 100% onto the council tax. The premium increases to 200% on properties that have been empty and unfurnished for five years or more. This applies to the property itself, so a change of ownership won’t affect it.
As the rules vary so much from council to council, it’s important to check the exact policy of the local authority. Don’t make any assumptions, and do claim any discounts for major repair work, if the council offers them.
>> Related Post: How to reduce costs and risks during void periods and refurbishment
Council tax liability for long term voids
Councils have the power to charge an empty homes council tax premium for properties that have been empty for 12 months.
However, there is a 12-month exemption under Class M for “empty dwellings requiring or undergoing major repairs or structural alterations”.
This means that property developers won’t be charged the premium unless refurbishment takes over two years.
There are also exceptions for properties undergoing probate or properties being “actively marketed for sale or let”.
More information is available in Guidance on the implementation of the council tax premiums on long-term empty homes and second homes.
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Thanks so much Suzanne i so much appreciate your updates in property i am a Landlord with portfolios in abroad but not yet in United Kingdom, i am on my move to become one that is why i needed to join in the group to know the pros and cons so that i can make a sensible decision.
I have an HMO which is split into three one bed apartments and one three bed. The tenants do not share anything except public area eg hall and stairs. My tenants have always paid their own council tax. Does this continue?
Section 257 HMOs are excluded from these regulations, but section 254 self-contained flats do come under the regulations.
If you’re not sure, you should speak to the council or call the NRLA.
Here’s another useful resource: https://www.gov.uk/government/publications/council-tax-information-letter-32023-changes-to-regulations-for-houses-in-multiple-occupation-hmos/council-tax-information-letter-32023-changes-to-regulations-for-houses-in-multiple-occupation-hmos
Hi Suzanne,
Great blog!
Could you help me clarify the impact of the recent legislation (Council Tax (Chargeable Dwellings and Liability for Owners) (Amendment) (England) Regulations 2023)
The blogs says:
“It is the owner of an HMO who pays council tax, and not the tenants. The definition of HMO for council tax is slightly different from the usual definition under the Housing Act 1988, and is in the Council Tax (Liability for Owners) Regulations 1992. The definition of an HMO for council tax purposes is a dwelling where the tenants or licensees only have the right to occupy part of the dwelling, or aren’t liable to pay rent or a licence fee for the whole dwelling.”
In other words this applies where the HMO tenants have individual ASTs per room ie they pay rent for their room rather than all the communal areas. The landlord is always liable. I thought this had always been the case even before recent legislation?
What about where the tenants are on a joint and several AST? eg students where the tenant is renting the whole property? Obviously the property is exempt where all the occupants are full-time students but who is liable becomes relevant if a student drops out of their course.
The blog suggests that in “student” hmos it is the tenants who are liable if council tax becomes payable (rather than the landlord):
“Full-time students at college or university are exempt from paying council tax. If everyone in the property is a full-time student, no council tax will be payable. If the student lives with others who aren’t full-time students, the others will need to pay council tax. However, the full-time student is disregarded for calculating the council tax.”
Thanks,
Steve
Why do different councils have different rules over what to charge when a property is empty
Mainly from changing from tenant to tenant or to another owner?
I note that they are a company the councils and therefore any monies owed are owed under a civil agreement not a legal law?
So why would one person want to pay the council when if they lived elsewhere they wouldn’t have to?
I actually want to pay the council tax in my name directly as my daughter and her partner live in a flat I own rent free covering the leaseholder service charges and utilities (in their names) only. Can I do this?
I’m sorry, but I don’t know the answer to this.
my tenant of 3 years had rolled into a statutory periodic tenancy and from which they gave 28 days notice to vacate – fine – however on hand back it was agreed by both parties that extensive dilapidation works were required – they kept the property a further 5 months doing these works, paying rent, holding the only keys etc. We had another hand back and things still hadn’t been completed still. So i returned the keys to them the same day so that they could finish their repairs (it had been trashed back at the first hand back) Finally after 8 months i received the keys and access back to my property. In the meantime, however, a council tax bill has arrived with me from the period when the second hand back inspection took place. As I see it they are liable until i received back the keys finally 8 months after the notice period – i didnt have access to the property until that date – they were “in occupation”. What do you think?
I’m sorry but I don’t give advice on specific circumstances via the comments section of the website. If you’re a member of The Independent Landlord Hub, you can ask this at the next Office Hours live Q&A on 26 September: https://theindependentlandlord.com/hub-waitlist/