The Council Tax (Prescribed Classes of Dwellings) (England) Regulations 2003

Explanatory Note

(This note is not part of the Regulations)

These Regulations relate to England. They prescribe three classes of dwellings for the purposes of section 11A of the Local Government Finance Act 1992 (“the Act”). Section 11A was inserted into the Act by the Local Government Act 2003.

In relation to dwellings of any class prescribed by the Secretary of State for the purposes of section 11A(3) of the Act, an English billing authority (a district council, London borough council, the Common Council of the City of London, the Council of the Isles of Scilly or a county council with the functions of a district council) may determine that the council tax discounts applicable where there is no resident of the dwelling (two discounts of 25 per cent each under section 11(2)(a) of the Act) shall be replaced by a lower discount (with a minimum discount of 10 per cent).

Class A is prescribed by regulation 4 of these Regulations for the purposes of section 11A(3). Billing authorities in England will be able to reduce the council tax discount, to a minimum of 10%, for chargeable dwellings which are unoccupied and furnished, and the occupation of which is restricted by a planning condition preventing occupancy for a continuous period of at least 28 days in the relevant year and therefore fall within Class A. Purpose built holiday homes or chalets subject to a planning condition restricting year round occupancy would fall within Class A.

Class B is prescribed by regulation 5 of these Regulations for the purposes of section 11A(3). Billing authorities in England will be able to reduce the council tax discount, to a minimum of 10%, for chargeable dwellings which are unoccupied and furnished, and the occupation of which is not restricted by a planning condition preventing occupancy for a continuous period of at least 28 days in the relevant year and therefore fall within Class B.

Regulation 6 and the Schedule to these regulations prevent a billing authority from reducing the discount for a second home owned by a council tax payer who is also liable for council tax for another dwelling (or who would be liable if that other dwelling were not exempt within Class O of the Council Tax (Exempt Dwellings) Order 1992 (S.I. 1992/558) as amended by the Council Tax (Exempt Dwellings) (Amendment) Order 1992 (S.I. 1992/2941)) provided to him or his spouse by reason of their employment. The definition of “qualifying person” in regulation 2 of these regulations, combined with regulation 6 and the Schedule, means that billing authorities cannot reduce the discount for second homes owned by service personnel who live in accommodation provided by the Ministry of Defence.

Regulation 6 and the Schedule also prevent billing authorities from reducing the discount in respect of a second home owned by a council tax payer who is also liable for council tax for another chargeable dwelling which he or his spouse is required to occupy under a contract requiring him to carry on a trade, profession or vocation in a property provide by another person and to live in a dwelling provided by that person. This means that second homes owned by e.g. publicans who are required to live in the licensed premises of which they are tenant, would continue to be subject to the 50% discount.

Regulation 6 and the Schedule makes similar provision preventing billing authorities from reducing the discount in respect of a second home where that second home is provided to the council tax payer by reason of his employment and he is also liable for council tax for another dwelling which is his sole or main residence.

In relation to dwellings of any class prescribed by the Secretary of State for the purposes of section 11A(4) of the Act, an English billing authority may determine that the council tax discounts applicable where there is no resident of the dwelling shall be replaced by a lower discount or by no discount at all.

Class C is prescribed by regulation 6 of these Regulations for the purposes of section 11A(4). Billing authorities in England will be able to reduce or end the council tax discount for chargeable dwellings which are unoccupied and substantially unfurnished and therefore fall within Class C. The dwellings falling within Class C will be long term empty homes, since for a shorter period, unoccupied and substantially unfurnished dwellings are exempt from council tax.

Class C of the Council Tax (Exempt Dwellings) Order 1992 (S.I. 1992/558) as amended by the Council Tax (Exempt Dwellings) (Amendment) Order 1993 (S.I. 1993/150), provides that a dwelling which is unoccupied and substantially unfurnished is exempt from council tax for up to six months. After that six month period of exemption, a dwelling which remains unoccupied and substantially unfurnished is currently subject to the 50 per cent discount under section 11(2)(a) of the Act. Dwellings falling within Class C of these Regulations will therefore be dwellings which are not exempt from council tax under Class C of the Council Tax (Exempt Dwellings) Order 1992 (i.e. which have been substantially unfurnished and unoccupied for more than six months).

Class A of the Council Tax (Exempt Dwellings) Order 1992, as substituted by the Council Tax (Exempt Dwellings) Order 2000 (S.I. 2000/424) provides that a dwelling which is unoccupied, substantially unfurnished and either requires, is undergoing or has undergone within the last six months, major repair work to render it habitable, or is undergoing, or has undergone within the last six months, structural alteration, shall be exempt. Such dwellings are exempt for up to 12 months. Class C of these Regulations will also include dwellings which have ceased to be exempt under class A of the Council Tax (Exempt Dwellings) Order 1992 e.g. if the repair works were completed more than 6 months ago and the dwelling is still unoccupied and substantially unfurnished, or the dwelling has remained unoccupied, substantially unfurnished and undergoing major repair work for more than 12 months.

Any determination of the billing authority under section 11A of the Act will apply in respect of all the dwellings of that class in the whole, or only in a part of its area,as the authority may specify.