Islington Council aims to close council tax loophole

A local authority in north London is trying to close a loophole concerning private rental property and council tax.

Islington Council is looking to stop landlords letting out student flats over summer holidays-when most students are away- to tourists and other visitors, in order to maximise income.

Students

There are over 4,000 student flats in purpose built accommodation blocks in Islington. In the past, this type of accommodation was given a full council tax exemption throughout the year, given the fact that students are not permitted to pay council tax.

However, Islington Council claims that more landlords are letting these students flats over the summer period.

As students are not living in the flats during this time, the flats are therefore liable for council tax. As an example, it states that if 1,000 of such flats are rented out for a 10-week period, council tax due amounts to £121,250.

In order to close this loophole, Islington council now requires landlords to provide tenancy and student occupancy details for every flat, in every week of the year.

Islington Council aims to close council tax loophole

Loophole

Islington is one of the first local authorities in the country to try and take action to close the loophole.

A council spokesman said: ‘At a time when Islington faces ongoing cuts to its budgets from central government, it isn’t fair that landlords have effectively been getting a tax break on renting their flats out over the summer. Closing this loophole means that the correct levels of council tax are collected, which is fairer for all our residents and helps to pay for local services in Islington and London.’[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2017/9/council-demands-info-on-tenants-for-every-week-of-the-year