Council tax is mandatory for all residents who are above 18 years of age. Through this blog post, we aim to discuss the timeframe when council tax is due on homeowners after buying a house. In addition to this, we will also explore the details of council tax calculations, and the valuation bands assigned to properties as situations where council tax discount is applicable.

When Do You Start Paying Council Tax After Buying A House?

You will start paying council tax on Completion Day after buying a house. Although the exchange of property may have taken place much earlier than this, you will not be liable to pay council tax during this time.

The most ideal way to proceed with getting registered for council tax payments is to apply on the council website and mention your Completion Day at least two weeks in advance. However, it also depends on the builder of the property as to the dates indicated regarding completion day and the Valuation Office Agency’s assessment of your property for the council tax band to be assigned.

In certain cases, it may be so that you are paying council tax at your previous house while also paying it for the new house due to overlapping dates during a month. If your council makes provision for a Second Home Discount, you may be able to avail of it on the new house until you move in completely. 

If you need to make renovations to your new house before moving in due to which you will not be able to move in despite Completion Day is marked by the seller, you may be able to get a council tax discount or even exemption until the property is termed as “liveable”. Similarly, if the new house that you are buying has been empty and unfurnished for six months you may be able to get a discount on your council tax bill.

However, if there are council tax arrears on the property, it is the responsibility of the previous owner to clear them before moving out. Even if they do not make these payments after the transfer of the property, the council will chase them for clearance of dues and not the new buyers of the house.

Council tax is a property based yearly tax levied on all homeowners and tenants over the age of 18. It is paid to local council offices over 10 months; as the yearly bill is split into instalments by local authorities. This makes it easier for individuals to make small payments that are spread over months as compared to making a lump sum annual payment of the tax.

The local council prepares a spending plan which shows details of the areas in which collections from council tax bills are to be spent. This plan is also shared with individuals required to pay the tax to give them an idea of the benefits that may expect through their collective contributions.

Some of the areas in which council tax collections may be used included the following:

  • fire and police services
  • trash collection
  • roads
  • education
  • libraries

How Are Council Tax Rates Assigned?

Council tax is based upon the valuation band that a property is categorized under by the local council and Valuation Office Agency. 

There are eight bands that run across A to H, with Band A assigned to properties with the lowest value and increasing up to Band H for properties with higher values. It is on the basis of this assigned band, that the amount of council tax is decided. Therefore, the higher the valuation band, the higher the council tax payments.

Below is a detailed classification of council tax rates according to their valuation bands:

Council Tax BandProperty Value
AUp to £40,000
BOver £44,000 and up to £52,000
COver £52,000 and up to £68,000
DOver £68,000 and up to £88,000
EOver £88,000 and up to £120,000
FOver £120,000 and up to £160,000
GOver £160,000 and up to £320,000
HOver £320,000 

Who Has to Make Council Tax Payments?

Any individual, over the age of 18 years, whether a homeowner or tenant, employed or unemployed, is eligible to pay their council tax bills to the local council office. This is an annual tax; spread across 10 monthly instalments between April and January with February and March considered tax holiday months.

Usually, one person is considered the prime point of contact and the one considered “liable” to pay council tax bills. To qualify for this, the said occupant must be above 18 years of age. Couples sharing premises are jointly liable for their council tax bills; however, anyone of them may be listed to be considered as liable for payments.

In the case of a rented property, it is the tenant who is liable to pay council tax. However, should any of the following situations occur, the liability becomes extended towards the owner:

  • all the occupants are under 18 years of age
  • the occupants are asylum seekers
  • the occupants are multiple households/ couples/ individuals co-sharing the rent and premises
  • the property is a second home or holiday home and the residents have a main home elsewhere
  • the property is a care home or refugee shelter

How Do I Pay My Council Tax Bills?

Council tax bills are paid through monthly instalments that range from the months of April to January.

Direct Debit is the most convenient method of making council tax payments since the annual tax is shared by the local councils at beginning of the term in April.

While the instalments assigned by local councils are 10, individuals wishing to spread them over 12 months instead may apply to their local council office and request the same. Payments may also be made on an annual or half-yearly basis. Local councils may also accept weekly or fortnightly payments as well. Generally, a discount may be availed if the payee chooses to pay the entire annual tax bill in advance.

Although the instalments are due on the 1st of each month, individuals choosing to pay through direct debit may choose the 1st, 8th, 15th or 22nd.

If an individual is unable to afford their monthly council tax instalment or would require a relief, they may request to have the annual bill be spread over 12 monthly instalments versus the usual 10 instalments. This reduces the per month average due to which the due amount is decreased.  

How Can I Avail Council Tax Reduction?

Whether residents own or rent their homes, they may qualify for a council tax reduction in their bill, if they meet any of the following criteria:

  • living alone: regardless of financial circumstances, living alone is enough reason to avail of a 25 per cent discount as council tax rates are established on the assumption that each house will comprise of two adults.
  • living with a full-time student: full-time students and student nurses are exempt from council tax bills. Sharing a residence with them qualifies you for a discount.
  • living with someone below 18 years of age: since council taxes are applicable on adults, anyone below the age of 18 does not qualify to be counted as a member of the shared household where council tax is levied.
  • being a carer: while there are additional criteria to be considered her, being a carer for another member of the household for at least 35 hours per week qualifies the individual for a CTR. 
  • changes in home value: if there is a change in the surroundings of your residential property causing a full-time decrease in its value, the council tax band may be lowered by a valuation expert, enabling you to enter a lower band with reduced council tax bills due.
  • the desired mode of payment: while council tax payments are spread over 10 monthly instalments, should you require a change such as 12-month instalments, it will reduce the monthly amount to be paid. On the other hand, should you prefer to pay the annual amount in a lump sum, a bulk payment may also qualify you for a discount.

What Happens When Somone Does Not Pay Their Council Tax Bills?

If someone is unable to pay their council tax, the first step taken by the council is to send them an official notice asking to clear their dues in the next 7 days. Should they not be able to make up for the missed payment, residents may be asked to pay council tax for the entire year ahead. 

Two such reminders may be sent by the council to encourage council tax payments. However, if the resident does not clear their arrears even after receiving the final notice from their local council, legal action may be taken. This includes possession of valuables and in certain cases eviction from residential premises.

Local councils also have the authority to demand the arrears directly from the defaulter’s employers who will deduct the amount from their salary. Furthermore, they may also apply to have the amount deducted from any benefits that the individual receives. These may include the following:

  • Income support
  • Employment allowance
  • Support allowance
  • Jobseeker’s allowance
  • Universal credit
  • Pension credit

Conclusion:

When you buy a new house, council tax is due upon new homeowners from Completion Day onwards even if they have not moved into the property. The amount of council tax that they will pay depends on the assessment of their property by the Valuation Office Agency and the tax band assigned by local council authorities. There may be times when you are moving from one place to another that you will end up paying council tax at both properties during the transition phase. However, if there are any council tax arrears due upon the property, the previous owners will be responsible for their payment.

FAQs: When Do You Start Paying Council Tax After Buying A House?

What months do you not pay Council Tax?

Council tax bills run from April to January. Therefore, you do not pay council tax bills in February and March.

How do I pay my council tax in Southwark?

You can pay your council tax in Southwark online or pay through your phone using a debit or credit card.

Who is obliged to pay council tax?

Any individual, over the age of 18 years, whether a homeowner or tenant, employed or unemployed, is eligible to pay their council tax bills to the local council office. 

Do squatters pay council tax?

Property that is illegally occupied by squatters is also due for council tax payments. This means that squatters are liable to pay council tax when they are residents of a house.

What happens if you don’t pay council tax?

If you don’t pay council tax, you are in debt which can be recovered through your wages or benefits claim or in extreme cases, you may be taken to court to pay your dues.

References:

Council Tax After Buying A House | First Time Buyer Help.

When-do-you-start-paying-council-tax-after-buying-a-house

Start paying Council Tax – GOV.UK

What is Council Tax? (southampton.gov.uk)

Paying council tax – Citizens Advice

Council Tax – GOV.UK (www.gov.uk)

Ways to pay your council tax | Ways to pay your council tax

Council tax: Why do some areas pay more and how can you reduce your bill? | This is Money

Council Tax – Home 

Family spending in the UK – Office for National Statistics (ons.gov.uk)

Check if you can pay less council tax

What was missing from this post which could have made it better?