Which homes should be exempt from council tax premiums?

18 August 2023

A cottage in Wales surrounded by flowers and hedges

Following measures aimed at reducing the number of empty and second homes, the government is consulting on which categories of dwellings should be exempt from council tax premiums. This consultation covers changes in England only.

Currently, local authorities can, at their discretion, apply a council tax premium to long term empty dwellings, which are defined as: a dwelling which has been unoccupied and substantially unfurnished for a continuous period of at least two years.

From 2024, the period of non-occupation will be reduced meaning that authorities can apply the premium after only one year.

In addition, a new discretionary council tax premium that billing authorities can apply could be up to 100% for dwellings classed as second homes. Second homes are defined as dwellings which are periodically occupied and substantially furnished but have no resident.

Both of these measures are aimed at reducing large concentrations of empty and second homes in particular areas, which can have a negative impact on local communities and services.

The government does recognise that there is a need for exemptions to these premiums in certain cases and is seeking views on:

  • whether they have identified these cases where exemptions should apply, and
  • whether they have missed any.

We will be responding to the consultation after having collated views from members on if there are other exemptions from these premiums that need to be in place, particularly in relation to dwellings on farms. 

We will publish our response shortly.

6 July 2023

Government launches consultation

The Department for Levelling Up, Housing and Communities has launched a consultation seeking views on which dwellings should be considered exceptions to council tax premiums.

This covers the empty homes premium and the second homes premium.

The government recognises the need for exemptions to these premiums and have identified the following cases where these could be applied:

  • Properties undergoing probate – 12 months exemption for both empty and second homes premiums from the date of probate is granted.
  • Properties being actively marketed for sale or let – 6 months exemption from the empty homes premium starting on the date that active marketing commenced, or until the property has been sold or rented, whichever is sooner.
  • Empty properties undergoing major repairs – 6 months exemption from the empty homes premium.
  • Job related dwellings where a person is required to live elsewhere for employment purposes (but not in cases where someone chooses to have an additional property closer to work) – exemption to the second homes premium.

NFU position

The NFU has identified a number of additional circumstances where exemptions are needed. These include:

  • Dwellings on farms mainly used to house family members or agricultural workers but which may have periods where they are unoccupied.
  • Dwellings which have planning restrictions on them such as Agricultural Occupancy Conditions.
  • Dwellings used to house seasonal workers but which remain empty outside the seasonal period.
  • Dwellings which are occupied but where the owner pays the council tax and not the occupier.

The NFU also believes that there should be an ability to extend some of the identified exemptions within reason. These include where probate has been granted, where the property is being marketed for sale or let or where the property is undergoing major repairs.

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  • 6 July 2023: The Department for Levelling Up, Housing and Communities has launched a consultation seeking views on which dwellings should be considered exceptions to council tax premiums.