The Local Government Finance Act 2012 amends the Local Government Finance Act 1992 allowing local discretion over the implementation of certain discounts and charges applied within the Council Tax regime.
The following policy details the approach to be taken by Portsmouth City Council with effect from 1st April 2019.
The City Council under this policy will make a charge for second homes of 100% (a discount of 0%). This is the level charged from 1st April 2014. In the following cases a charge of 50% will apply (rather than the 100%) as required by legislation;
The legislation outlining the above is the Council Tax (Prescribed Classes of Dwellings) (England) Regulations 2003 as amended by the Council Tax (Prescribed Classes of Dwellings) (England) (Amendment) Regulations 2012. The regulations require the authority to determine the classes under which a discount will be granted. For the purposes of this policy the classes and discounts to be granted by the City Council from 1st April 2014 are as follows;
| Class | Descriptions | Discount |
|---|---|---|
| A | A dwelling;
| 0% |
| B | A dwelling;
| 0% |
For Council Tax purposes, the revised legislation determines that the charge for empty dwellings will follow three phases namely;
First Phase: a period during which a dwelling will attract the discount of between 0% and 100% determined by the local authority (as a result of the measures outlined within the Local Government Finance Act 2012). If the dwelling remains empty and substantially unfurnished, this period will last up to 6 months (This replaces Class C of the Council Tax (Exempt Dwellings) Order 1992) as determined by the authority (12 months if the dwelling in addition to being unoccupied and substantially unfurnished is undergoing major repairs (This replaces Class C of the Council Tax (Exempt Dwellings) Order 1992));
Second Phase: a period during which the discount attracted will be between 0% and 50%. The rules for this phase are based on the Council Tax (Prescribed Classes of Dwellings) (England) Regulations 2003 as amended by the Council Tax (Prescribed Classes of Dwellings) (England) (Amendment) Regulations 2012. During this phase the authority can determine (in accordance with Class C of the regulations) the level of discount between 0% and 50%. The second phase will last indefinitely unless the local authority has made a determination implementing the empty homes premium.
Third Phase: an indefinite period starting when the dwelling has been empty for two years. In this phase, the liability may be increased by an additional premium (Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018).
Where a dwelling is unoccupied and substantially unfurnished
If a dwelling becomes unoccupied and substantially unfurnished the City Council will apply a discount of 0%, requiring the full council tax charge to be payable.
Where a dwelling is unoccupied and substantially unfurnished, requiring or undergoing structural alterations or major repair works to make it habitable
(a) If a dwelling is unoccupied and substantially unfurnished, requiring or undergoing structural alterations or major repair works to make it habitable, a discount of 40% will be granted for any period up to one year so long as it remains so for a period up to 31st March 2020. The City Council has resolved that this discount shall be reduced to 0% with effect from 1 April 2020;
(b) If a dwelling in (a) above remains unoccupied and substantially unfurnished for a period of greater than one year, 0% discount will be given after the end of that year.
Where a dwelling remains unoccupied and substantially unfurnished for a period of two years or more
(a) Where a dwelling remains unoccupied and substantially unfurnished for a period of two years or more, the City Council has resolved to charge an empty homes premium of the relevant maximum in addition to the full Council Tax charge, as allowed within Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018.
For the financial year beginning 1 April 2019: The relevant maximum is 100% for dwellings that have remained unoccupied and substantially unfurnished for a period of at least 2 years.
For the financial year beginning on 1 April 2020: The relevant maximum is 100% for dwellings that have remained unoccupied and substantially unfurnished for a period of at least 2 years but less than 5 years.
The relevant maximum is 200% for dwellings that have remained unoccupied and substantially unfurnished for a period of at least 5 years.
For the financial year beginning on 1 April 2021: The relevant maximum is 100% for dwellings that have remained unoccupied and substantially unfurnished for a period of at least 2 years but less than 5 years.
The relevant maximum is 200% for dwellings that have remained unoccupied and substantially unfurnished for a period of at least 5 years but less than 10 years.
The relevant maximum is 300% for dwellings that have remained unoccupied and substantially unfurnished for a period of at least 10 years.
The City Council, in accordance with the legislation, will publish the changes to the Council Tax regime within 21 days of making such a resolution.
