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Who Pays Council Tax? And How is it Calculated?

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When you rent a property, it should state clearly in the tenancy agreementwho pays council tax for the property. Unless this is all swept up in your rent, it’s typically going to be the tenant. You may also be asking how council tax is calculated. We explain all.

Who pays council tax?

If you’re over 18 and you rent your home, you’ll be liable for paying council tax.

Usually council tax is paid by the occupant of the property. If you live alone, you are solely responsible for paying it though you are eligible for a discount. If you live in a multiple occupancy property, there is a hierarchy of liability to establish who has to pay it.

The hierarchy is usually (from top to bottom):

  • The owner occupier
  • The tenant occupier
  • Licensee residents
  • Squatters
  • The owner who doesn’t live there and doesn’t have tenants

The person at the top of the hierarchy has to pay the council tax. If there are equal numbers of you, you’re all equally responsible.

How is council tax calculated?

Council tax is based on the property’s value and each local council will have their own prices for each band of council tax. This makes it impossible to determine exactly how much council tax you will have to pay.

However, My Council Tax is a helpful tool to approximate how much council tax you might be required to pay. This is worth having a look at when you’re working out your budget.

When does the tenant not pay council tax?

There are a few instances where you don’t have to pay council tax. In these circumstances it’s the responsibility of the landlord. You may be exempt from paying council tax:

  • If you’re under the age of 18
  • If you live in a house of multiple occupancy and you all pay individual rent – in this case the council tax is probably worked into your rent though the landlord is technically responsible for paying it
  • If you’re an asylum seeker
  • When you’re only renting the property temporarily i.e. your main rental property or home is having emergency work done to it

A full council tax bill is calculated based on two adults living together in a property. There are a number of circumstances where you may receive a discount on your council tax bill, these include:

  • If you are over 18, and live on your own, you’ll be eligible for a 25% discount
  • If you don’t ‘count as an adult’, you’ll typically get a 50% discount
  • If you’re full-time students living in the property you’ll get a 100% discount
  • If you’re disabled or the live-in carer of someone who is disabled (who isn’t your spouse, child or partner)

What happens if you don’t pay your council tax bill?

If you’re responsible for paying council tax and you find yourself in arrears, your local council can take various measures to recover the debt directly from your employed income or apply for deductions from any benefits. There are also some things you’ll need to arrange in regards to council tax if you’re moving out of your property soon.

If you find yourself in this position you’d be well advised to speak directly with your local council as soon as possible.

Phil Spencer’s Property Report contains information on local valuations and rental estimates, you can use this to make sure you are not paying over the odds for a property. Get your full report here.

Last Updated: January 12th, 2024