Discounts for empty homes and annexes

Billing authorities in England and Wales have the power to increase council tax on properties which have been ‘unoccupied and substantially unfurnished’ for a long period of time. This is known as the ‘empty homes premium’.

In the Autumn Budget 2017, the chancellor of the exchequer announced the government’s intention to bring in legislation to set the maximum council tax ‘empty homes premium’ in England up to 200%.

In essence, to address what the government terms as the ‘issue of empty properties’, the billing authorities in England will be able to double the council tax charge against the owners of dwellings that are left unoccupied and unfurnished for two years or more.

From 1 April 2013, local authorities in England had the power to set an ‘empty homes premium’ for long-term empty properties up to 150%. Since 1 April 2017, as a result of the Housing (Wales) Act 2014, local authorities in Wales have been able to charge a premium of up to 100% of the standard rate of council tax on long-term empty homes and second homes in their areas.

In Scotland, billing authorities can charge up to 200%, and the qualifying period is one year. Wales introduced equivalent powers to those in Scotland in 2017, alongside a power to charge up to 200%council tax on holiday homes with no permanent resident.

It is likely that there will be legislation produced for England, similar to Section 139 (Amount of tax payable for certain types of dwelling) of the Housing (Wales) Act 2014, allowing English authorities the same powers as those given to Welsh authorities by the Welsh Assembly.

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