Landlords, listen up! From 1st April this year, a new regulation came in relating to empty properties – a 100% council tax premium on long-term empty properties. Let's unpack what this means for your investment portfolio and how to avoid this potential double whammy!

Empty properties are a double-edged sword. They generate no income, yet local councils still have to provide essential services in those areas. This new rule aims to make leaving properties vacant even more unappealing than it already is, and encourage them back into the market, ultimately boosting housing supply.

The new policy will mean that if your property remains unoccupied for more than a year, you'll be slapped with a 100% council tax premium on top of the existing council tax amount. This double payment of council tax is likely to hit the pocket hard, so it's best to get properties ready to be relet as quickly as possible, which will in turn bring further income in.

There are some exemptions, but they're quite specific. Properties undergoing major refurbishment, those for sale with a genuine intention to sell quickly, and those with legal restrictions on occupancy might qualify. However, always double check with the council to ensure you meet the exemption criteria.

 

Avoiding the Empty Tax Trap:

So, how do you steer clear of this empty tax trap? Here are some tips:

  • Keep Your Properties Rented: Maintaining your properties in good condition and offering competitive rents are key to attracting tenants and keeping them happy.
  • Consider Short-Term Lets: If a long-term vacancy is unavoidable, explore short-term lets while adhering to any council regulations surrounding such arrangements.
  • Communicate with the Council: If you anticipate a long-term vacancy due to unforeseen circumstances, proactively communicate with the Council. They might offer some flexibility depending on the situation.

 

This new regulation is meant to serve as a wake-up call for landlords to manage their vacant properties effectively. By proactively addressing vacancies and exploring alternative options, you can ensure investments continue to be a source of income, not a financial burden.

If you need help navigating this new landscape or are worried about a property you currently have empty, our lettings team at Eightfold Property is here to assist. We can help you assess your options, explore short-term letting solutions, and ensure you're compliant with all council regulations. Don't hesitate to reach out – let's work together to keep your properties occupied and your profits flowing!

 

For more, see Gov.uk

Photo by Point3D Commercial Imaging Ltd. on Unsplash