Do you know who pays council tax – the tenant or the landlord? Working out who’s responsible for the bill can sound complicated – but it might be easier than you think. Here’s what you need to know about tenants, landlords and council tax.
Is the tenant always responsible for paying council tax? It depends on who lives in the property, and how the tenancy contract is set up. Luckily, there are clear hierarchies in place and plenty of guidance from local authorities.
Southwark Council covers many rental properties in Waterloo, Bermondsey, London Bridge or Borough. However, if your property is near a boundary, find out which borough you belong to. Sometimes the rules vary between local authorities, so it’s worth ensuring you follow the right guidance.
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Your council tax bill contributes to daily necessities like refuse collection, recycling and repairing local highways. Council tax also pays for emergency services like the police and fire brigade.
In Southwark, it maintains green spaces like Burgess Park and sports facilities like Southwark Athletics Centre for residents. Council tax also supports libraries and community-centred spaces like Southwark Heritage Centre.
Most Southwark residents’ council tax goes directly to Southwark Council. Then, a percentage goes to the Greater London Authority (GLA), and another proportion contributes to adult social care.
Council tax charges in Southwark range from £1,128.61 to £3,385.84 for 2023/24. It’s paid annually or in monthly instalments and undergoes review each financial year.
So, how is council tax calculated? The charges are divided into bands based on the property’s value as of 1 April 1991. That’s not a mistake. By a quirk of the system, the 1991 values are still the baseline three decades later.
But they’re not the be-all and end-all. The council can change your property’s band if it’s been altered or another comparable property has been re-banded.
Council tax charges are always changing, here are the current costs for the different property bands in Southwark, alongside the increase from the previous tax year.
Who is responsible for paying council tax – the landlord or the tenant? There’s a hierarchy that decides who should pay:
The tenant will pay the council tax if there’s only one tenancy. If letting to a family or to joint tenants on the same tenancy agreement, they share responsibility for council tax obligations between them.
In houses in multiple occupation (HMOs), the landlord is liable for their private rental property’s council tax.
An HMO is a property where multiple households pay rent for shared facilities (usually bathroom, toilet or kitchen areas) and their private space, such as a bedroom or bedsit. Each person will have an individual tenancy agreement to occupy only part of the building.
The rules on paying council tax vary according to the type and duration of your tenancy.
If the property is empty, landlords must pay council tax in the London Borough of Southwark. But in certain situations, the landlord is responsible for the council tax while tenants are in situ.
The rules come down to how the rental property is used, and who the tenants are:
Council tax exemptions may apply in some situations, though they are not granted automatically. Read on for the full details.
Read more about HMO licensing in Southwark here.
Landlords are typically responsible for paying council tax on empty properties, but the exact rules depend on local council regulations.
For properties that are empty and unfurnished, many councils offer a temporary exemption or discount for a limited period, such as 1–6 months. Once this period ends, the landlord usually must pay the full council tax, even if the property remains unoccupied. However, if the property is furnished but not occupied, the landlord is generally liable for the full council tax from the outset.
If a property remains empty for an extended period, such as over two years, many councils impose a council tax premium, which can increase the charge by 50–300%. Local rules vary significantly, so landlords should consult their specific council to understand the applicable exemptions, discounts & potential penalties.
Yes, landlords can include council tax in the rent, but this depends on the tenancy agreement. When it’s included, the landlord must pay it directly to the local council, and the tenant’s rent is adjusted to cover the cost accordingly. This arrangement is much more common for properties rented as house shares, HMOs (houses in multiple occupation), or serviced apartments – where it’s more common to see utilities and other bills bundled together in a single payment.
In such cases, it is essential that the tenancy agreement clearly specifies that council tax is included in the rent. Unless it’s clearly stated in the agreement, tenants need to assume that they are liable for council tax.
Occasionally, a landlord needs to pay council tax on more than one property. This can happen if several properties are vacant at the same time. For example, if your tenants have left the property and a new tenancy hasn’t yet begun.
Southwark Council offers council tax discounts and exemptions based on tenants’ personal situations and occupations. For example:
Tenants living alone can claim a 25% discount on their bill.
As a landlord, you can apply for a discount if your tenants are eligible. But reductions aren’t applied automatically; you’ll need to apply.
Check the Southwark Council website for full details of council tax discounts and exemptions.
The tenancy agreement should clarify whether the tenant is responsible for the council tax. If the tenant needs to pay council tax, then unpaid bills are not the landlord’s responsibility. But if you’re a landlord who pays the council tax on your property, you must stay on top of those payments.
Contact Southwark Council immediately if you can’t pay because they may offer an affordable solution. If you don’t get in touch, the consequences can be severe.
In Southwark, you will only receive two reminder notices per tax year – miss a third payment, and the year’s outstanding council tax will be demanded in full. The next step is a court summons.
Depending upon your situation as a landlord, you might be liable for council tax. That said, most normal situations mean that the tenant pays council tax rather than you. It’s important to keep up with any changes imposed by the local council to ascertain your responsibility, and any amendments to the rules in 2025.
We’re here to support you with advice and expertise. It’s all part of our letting service. So, if you have any questions about council tax on your rental property, talk to us.
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