Consultation outcome

Summary of responses and government’s response to the consultation on proposals to exempt categories of dwellings from the council tax premiums in England

Updated 11 March 2024

Overview of the respondents 

There were a total of 615 responses to the consultation. We are grateful to everyone who took the time to respond and share their views and suggestions. All responses have been given full consideration as part of the decision-making process informing the changes announced in this document. 

The table below gives a breakdown of consultation responses by respondent type. 

Respondent type	Number of responses
Member of the public	406
Owners of rental properties	101
Local Authorities	88
Organisations specialising in housing and holiday homes	8
Other bodies	6
Local authority councillors	3
Interest group or voluntary organisation	1
Members of Parliament	1
Parish Councils	1

This document provides a summary of the consultation responses received and does not attempt to capture every point made. It deals with the questions grouped by topic, rather than in strict numerical order. In light of the responses received, it sets out the exceptions to the second homes and empty homes premium that we propose to include in regulations, including the duration of the exception period. 

Introduction 

The government recognises that second homes and empty homes can have impacts in some communities, particularly where a significant proportion of properties are not occupied all year round. Large numbers of empty homes can contribute to housing supply pressures, whilst also reducing the desirability of local areas. Second homes can provide flexibility to enable people to work in and contribute to the local community, whilst being able to return to a family home in another part of the country on a regular basis. However, large concentrations of second homes reduce the size of the permanent population, which can lead to local services becoming unsustainable.  

To combat this, the Levelling Up and Regeneration Act contains measures to strengthen the existing empty homes premium so that dwellings unoccupied and substantially unfurnished for one year, rather than two, are liable for the empty homes premium from April 2024 where the billing authority has decided to apply the premium in its area. The Levelling Up and Regeneration Act also introduces a new discretionary council tax premium on “dwellings occupied periodically” from April 2025. For the purposes of the response, this will be referred to as the second homes premium. These premiums provide councils with tools to raise extra revenue, which can be used to support services and keep council tax down for local residents.  The exceptions proposed in the consultation document would only apply to these premiums. Where properties are not liable for a premium, the property will continue to be liable for the standard rate of council tax. In order for the exception to be applied to their council tax bill, owners of such properties may need to make an application to their local council.  

To ensure that the measures are effective, the government published a consultation on 6 July 2023 seeking views on circumstances where it may not be appropriate for these premiums to apply. The consultation closed on 31 August 2023 and received 615 responses from a range of stakeholders including members of the public, owners of second homes, landlords, local authorities, organisations specialising in housing and holiday homes, councillors, Members of Parliament, and other bodies. Overall, there was broad support for the exceptions proposed in the consultation document.  

The strengthened empty homes premium will come into effect from April 2024. There is a requirement that councils must make a determination at least one year in advance of introducing a second homes premium. As such the earliest a council can utilise the second homes premium is April 2025. The government will legislate to bring the exceptions into effect for 2025-26 financial year.  

This document summarises the responses received to the consultation, confirms the policy position on these exceptions, and provides further detail on how the government will amend the criteria following the consultation. The government will issue guidance for councils and the public on the empty homes and second homes premium.  

Summary of consultation responses and government response 

Exceptions to the second homes and empty homes premium 

Properties undergoing probate. 

Question 1 – Do you agree that properties that are unoccupied or have no resident following the death of the owner should be an exception to either or both of the council tax premiums following the grant of probate or letters of administration? 

Question 2 – Do you agree that a period of 12 months after probate, or letters of administration have been granted, is an appropriate period? 

Overview of responses 

Around two-thirds of respondents did not provide a response to questions on this exception. Of those who responded, the great majority agreed that there should be an exception for properties where the owner/tenant of the property has passed away. The great majority also agreed that the proposed 12-month period was an appropriate timeframe for the exception to apply. Several councils felt that the proposed exception is not necessary as there is an existing council tax exemption under class F for properties undergoing probate, which they believe is sufficient.  

Detailed comments 

• Several councils felt that the proposed 12-month period was too long and that 6 months would be more appropriate.  
• The Local Government Association commented that their preference would be for councils to use their discretion to extend the period before either premium applies by up to a further 12 months, rather than having this as a statutory exception.  
• The Institute of Revenue Rating and Valuation suggested that the period should be 12 months after the premiums would become due, or 18 months after probate.  
• The District Councils’ Network suggested an exemption for 6 months on top of the existing class F exemption would be more appropriate and that the exception should be discretionary. 
• Several councils commented that the exception should not be combined with the proposed exception for properties marketed for sale or let, commenting that a combined period is too long.  
• One council commented that they already have a similar exception in place and that a 24-month exception would be more appropriate. 
• One council commented that if a decision to retain the property as a second home has been made following the grant of probate, then a decision regarding affordability has already been made and as such the property should be liable to the premium.  
• One council commented that considerations should be given for properties that were already long-term empty prior to the death of the owner. The proposal would mean that a long-term empty property, which might already be a local blight, would be granted an exemption and would extend the time that the property is a nuisance to the local community. 
• One council suggested that councils should be allowed to maintain discretion in the application of an exception.  

Government response  

The government recognises that it may take some time to decide how to make use of an inherited property.  

There is an existing exemption (Class F) for unoccupied property where probate or letters of administration have not yet been granted. After probate has been granted, provided the property remains empty and in the control of the estate of the deceased, an exemption of up to 6 months may be applied.  

There may also be cases where the property was already empty prior to the death of the owner/tenant until probate has been granted (for example if the owner has gone into care or had to move in with relatives). In such cases, where the property was left empty for at least a year prior to the granting of probate or letters of administration, they may become liable for the premium immediately after the Class F exemption period ends.  

To support people inheriting a home who may require time to decide how to deal with the property or may have difficulties selling, the Government will legislate to ensure that inherited properties will have a 12-month exception from the empty and second home premiums after probate or letters of administration have been granted. The property will be liable for the standard rate of council tax once the class F exemption has ended; but a premium cannot be levied for a 12-month period. Where there are cases that merit a longer exception period, or a higher level of discount, councils can continue to exercise their discretion.  

Properties being actively marketed for sale or let 

Question 3 – Do you agree that properties actively being marketed for sale or let should be an exception to either or both of the council tax premiums? 

Question 4 – Do you think an exception to the premiums for up to 6 months for properties being marketed for sale or let is a reasonable period? 

Question 5 – Do you agree that the evidence requested above would be appropriate to demonstrate that the property is actively being marketed for sale or let? 

Overview of responses 

Around two-thirds of respondents did not provide a response to this exception. Of those who responded, the vast majority supported the proposed exception. There were mixed views on the proposed time-period in which the exception should apply, with some arguing that the time limit was too short given the challenges of selling or letting a property, for example if it is part of a chain. The great majority felt that the evidence listed in the consultation required to demonstrate that a property is actively marketed for sale or let was sufficient. Several councils felt that they would benefit from additional guidance from central government as to what evidence is considered valid.  

Detailed comments 

• One council proposed that the exception should only apply from the point that the property first became empty.  
• One council commented that the evidence should show that the property was continually being actively marketed.  
• Several councils felt that the exception could be used as an avoidance tactic as properties could be marketed at an inflated rate. They argue that the empty homes premium is the most useful tool for councils to encourage empty properties to be brough back into use and therefore disagree with the exception.  
• Several councils propose there be a requirement within the regulations that the property is ‘being marketed at a reasonable price on the open market’ to minimise the risk of owners marketing the property at an inflated rate, with the onus on the owner to provide evidence to support the asking price, such as details of recent house sales, photographic evidence of the physical state of the property, estate agent confirmation of valuation. 
• Several councils commented that the exception would be challenging to administer, could be open to abuse and create opportunities for avoidance.  
• The District Councils’ Network commented that there will be administrative burdens placed on councils in applying the exception, and noted concerns about the number of times the exception could be applied. For properties that are being let, they suggested that the let must be for at least 6 months.  
• One council suggested that renewing the exception where there has been a change of ownership may create opportunities to abuse the scheme, given the new owner has the opportunity to establish the amount of council tax liability prior to the purchase.  
• One council highlighted the importance of guidance on what constitutes active marketing. The council commented that selling a property may take longer than 6 months, whereas rentals may be let out in less than 6 months. They also want to ensure that the exception cannot be stacked – for example by marketing for let for 6 months, and then for sale for a further 6 months.  
• Several councils suggest the exception should apply for 12 months rather than 6 months, to take into account the current cost of living and interest rates. They also comment that they would want to see owners taking further steps to sell/rent the property, such as reducing the price or carrying works to make it more attractive to sell/let.  
• The Local Government Association commented that there is already non-statutory guidance in place on the empty homes premium which makes reference to councils taking into account how long properties have been available for sale or let before completion/occupation. Any regulations and/or guidance would need to be framed carefully to reduce the scope for avoidance. Making the exception discretionary rather than statutory would give councils more powers to ensure that properties taking advantage of this exception are genuinely being marketed for sale or let.      
• One council suggested that the time limit should be consistent across all exceptions (either 6 or 12 months). 

Government response  

The premiums are not intended to penalise owners who are already taking steps to bring properties back into beneficial use. The government will legislate to introduce an exception for second and empty homes that are being actively marketed for sale or let.  

Of those who responded, the majority felt that the exception period was not long enough to complete the process of selling a property. The government will legislate to ensure that a 12-month exception to both premiums applies to properties that are actively marketed for sale or let, rather than 6-month exception proposed in the consultation. The exception would run from when the exception first applies until the end of the exception period or until the property is no longer actively marketed, sold, or let (whichever is sooner).  

Owners may need to make an application and provide evidence to their council to benefit from this exception. To qualify, a property must be on the market for sale or let at a reasonable price. In cases where the council considers the sale or rental price to be inflated, the council can request evidence to support the asking price. This can for example be estate agent valuation or recent house sales for similar properties. The marketing can be done through estate agents, online websites, and online-only agencies.  

This exception will provide protections for landlords whose rental property may become empty in-between lets or have a gap between tenancy agreements. It also covers properties where an offer to rent has been accepted but the tenant is not yet entitled to occupy the property because the tenancy has not yet started. The exception can also be used where the sale is taking time to complete because it is part of a chain. Councils are also free to use their powers to offer discretionary discount where circumstances merit it.  

Where the owner of a dwelling has not changed, the exception can only be applied once. Where the property has been sold to a new owner, the exception may be applied again where it meets eligibility criteria. If the sale of a property takes longer than the exception period and owners have demonstrated that the property is in the process of sale, the government would encourage councils to consider whether it would be appropriate to make use of their discretionary powers.  

For properties that are marketed for let, the exception period runs for up to 1 year from the exception first applying. The exception cannot be applied again unless the property has been subject to a tenancy that was granted for a term of 6 months or more. This exception is not intended to cover properties that are marketed for short term lets, such as holiday lets. If the property is a short term let, the property will generally be liable for business rates and as such are not subject to the premium.  

The government notes the concerns with the potential administrative burden and will issue further guidance on the administration of this exception.  

Exception to the empty homes premium 

Empty properties undergoing major repairs – time limited to 6-month. 

Question 6 – Do you agree that properties undergoing major repair work should be an exception to the empty homes premium?  

Question 7 – If so, do you agree that 6 months is a reasonable length of time for an exception to apply whilst major repairs or structural alterations are being undertaken?  

Question 8 – Do you agree that this exception should only be applied to the empty homes premium? 

Overview of responses 

Around two-thirds of respondents did not provide a response to questions on this exception. Of those who responded, the great majority supported the exception. Respondents commented that when a property has been empty for a considerable time, major repair works, or other works may be necessary. Of those who supported the exception, a significant proportion felt that the exception period was too short. The remainder of the respondents were split between those who felt that the 6 months was sufficient and those who felt that the period was not sufficient but did not say whether they thought this period was too short or too long.  

A small proportion of respondents disagreed with the exception, arguing that removing the premium might disincentivise owners or developers from completing projects rapidly.  

Detailed comments 

• The Local Government Association commented that councils will want to take account of all the circumstances surrounding major repairs before deciding whether to apply the premium. They also noted that an empty home is more likely than a second home to require major repairs or structural alternations.  
• The Institute of Revenues Rating and Valuations suggested a further discretionary period of up to 6 months beyond the initial exception period would be appropriate.  
• The District Councils’ Network commented that new owners will already benefit from 12 months before the empty homes premium can apply which should be sufficient to undertake work.  
• Several councils commented that the exception will place additional administrative burdens on councils.  
• A number of councils and respondents commented that where a property requires extensive works, such as major repairs or structural alternations, a 6-month exception period may be too short.  
• A number of councils commented that the qualifying works should be clearly defined, as some residents felt that refurbishment works (such as replacing windows or bathroom) may meet the criteria for the exception.  
• Some councils suggested a shorter period for rental properties and a longer period for sale may be more appropriate, reflecting high demand for rental properties.  
• One council suggested that the exception should be applied to all dwellings undergoing repairs that renders the property uninhabitable. The council also proposed that there should be an exception in cases whereby a block of flats are decanted to enable such major works/remodelling.  
• One council commented that removing the premium will disincentivise property owners and developers from completing the project in a reasonable time frame.  

Government response  

The government will legislate so that properties undergoing major repairs or structural alternations will have a 12-month exception from the empty homes premium rather than the 6-month exception proposed in the consultation. This increase in the exception period responds to the views from respondents to the consultation that major repairs work, or structural alternations are generally likely to take a longer period to complete. Owners of such properties can only make use of the exception once. Those that benefit from the exception will still be liable for the standard rate of council tax.  

The government notes the comments from a several councils that the exception will place an additional administrative burden on councils. This exception will be similar to the Class D which is already provided for in relation to removal of the discount for dwellings with no resident in the Council Tax (Prescribed Classes of Dwellings) (England) Regulations 2003. The exception is not intended to cover redecoration or refurbishments such as replacing kitchens, bathrooms, windows. 

In cases where the property is unhabitable, the owners can apply to the Valuation Office Agency to have the property removed from the council tax list.  

Councils can use their discretionary powers to grant further discounts beyond the initial exception period where they feel that is appropriate. 

The government’s intention is that time-limited exceptions for properties undergoing probate, properties actively marketed for sale or let, and properties undergoing major repairs or structural alterations can be applied in succession, where the property owner meets relevant eligibility criteria. Further details on how this will be applied will be set out in regulations or the explanatory memorandum.  

Exceptions to the second homes premium only 

Annexes forming part of, or being treated as part of, the main dwelling. 

Question 9 – Do you agree that furnished annexes which are being used as part of the sole or main residence should be an exception to the council tax premium on second homes? 

Overview of responses 

Around two-thirds of respondents did not provide a response to this exception. Of those who responded, the great majority agree with the exception. A very small minority disagreed with the exception.  

Detailed comments 

• The Local Government Association suggested that the policy objective of the second homes premium is not to change the status of furnished annexes which are being used as part of an adjacent sole or main residence. However, this should not apply to a furnished annex where the main residence is elsewhere. 
• One council argued that, given annexes already benefit from a 50% discount, there is no need for an exception from the second homes premium.  

Government response  

Under section 11C of the Local Government Finance Act 1992 (as inserted by the Levelling Up and Regeneration Act 2023) the second homes premium may be applied to a dwelling that is i) substantially furnished and ii) it is not someone’s sole or main residence. Generally, where the annexe is occupied (for example, where a relative is living in the annexe), the second homes premium cannot be applied as the circumstances do not meet the definition in the Act.  

Existing regulations prescribe a 50% reduction in the amount of council tax payable for annexes which are unoccupied, provided it is being used as part of the sole or main residence. Without the exception, the premium would be payable on such annexes and would in effect nullify the existing discount1. The government will therefore legislate to ensure that the discount remains in place and that the second homes premium cannot be charged on such annexes, mirroring the existing provision for the empty homes premium. The exception will apply to annexes which form part of a single property which includes at least one other dwelling. The exception will not apply to annexes where they are not being used as part of the main residence.  

Job-related dwellings 

Question 10 – Do you agree that the second homes premium should not apply to properties that are subject to the job-related dwelling discount? 

Overview of responses 

Around two-thirds of respondents did not provide a response to the question on this exception. Of those who responded, the great majority agreed with the exception and a small minority disagreed.  

Detailed comments 

• One council stated that the scope should include staff accommodation that is in curtilage of employer’s business and that councils should have option to use their discretion.  
• Several respondents commented that the exception should be extended to those who have a second home closer to their place of employment.  

Government response  

Currently, the empty homes premium cannot be charged on a property that is empty because the owner has to live in armed forces accommodation for job-related purposes. The government will mirror this provision for the second homes premium.  

There is an existing council tax discount of up to 50% for properties that are unoccupied because the owner is required to live elsewhere for employment purposes. Where a job-related dwelling discount is in place, the discount will continue to apply and the property will be an exception to the second homes premium. This exception is intended for circumstances where: 

a) it is necessary for the proper performance of the duties of the employment;

b) the dwelling is provided for the better performance of the duties of the employment, and where it is customary for employers to provide dwellings for employees; and

c) the occupant is contractually obligated to be resident at that property to carry on a trade or profession at that address.

The government will legislate to introduce an exception from the second homes premium for job-related dwellings. This exception will not apply to cases where someone chooses to have an additional property to be closer to work while having a family home elsewhere or where an individual is posted to a new location but maintain their previous address. Councils can exercise their discretion to apply council tax reduction under section 13A(1)(c) of the Local Government Finance Act 1992 where they deem it appropriate.  

Occupied caravan pitches and boat moorings 

Question 11 – Do you agree that pitches occupied by caravans and moorings occupied by boats should be an exception to the second homes premium? 

Overview of responses 

Around two-thirds of respondents did not provide a response to this exception. Of those who responded, the great majority agree with the exception. A very small minority disagreed with the exception.  

Detailed comments 

• Two councils commented that those who own such properties have chosen to do so and therefore the premium should apply. It was also commented that these types of properties tend to be second homes for holiday accommodation.  
• One council proposed that an exception should only apply where the pitch/mooring is in the curtilage of the main property and no exception should apply where it is in a separate location.  
• Several councils commented that a premium would provide an incentive to have the property occupied.  

Government response  

Currently, a 50% council tax discount is available for dwellings that consist of a pitch occupied by a caravan, or a mooring occupied by a boat where they are not a person’s sole or main residence. The government will legislate so that such caravans and boats should be an exception to the second homes premium and caravans and boats that are currently eligible for this discount continue to receive the discount.  

Seasonal homes where year-round or permanent occupation is prohibited or has been specified for use as holiday accommodation or prevents occupancy as a person’s sole or main residence.  

Question 12 – Do you agree that seasonal homes, where year-round occupation is prohibited, should be an exception to the second homes premium?  

Overview of responses 

The overwhelming majority of respondents agreed that properties that have restrictions or other conditions on use and occupation should be excluded from the premium. A small minority of respondents disagreed with the exception.  

Detailed comments 

• The Local Government Association commented that although councils may wish to consider exempting seasonal homes where year-round occupation is prohibited, where such properties constitute a sizable proportion of properties liable to the second homes premium, councils should be able to determine whether the premium should apply. 
• The District Councils’ Network commented that the exception should be clearly defined to determine whether the conditions prevent the property from being lived in as a sole or main residence. 
• One council proposed charging seasonal homes a proportion of the second homes premium, in line with the proportion of the year in which it is available for occupation.  
• Several councils commented that the period of non-occupation is too short.  
• Two councils proposed that the exception to seasonal homes, which are higher in certain areas, may cause a financial impact on councils.  
• Several councils commented that the exception should be discretionary rather than mandatory.  
• Several councils commented that this will be an administrative burden for councils to administer.  

Government response  

Some classes of property have planning restrictions or other conditions on occupation or use in place which prevent year-round occupation. For example, a holiday chalet may have restrictions from being used as a sole or main residence, or a condition may be in place that means it cannot be occupied for parts of the year, or places limitations on how many days it can be occupied each year. These properties cannot therefore practically be used as a main home. To ensure consistency, the government will legislate so that the second homes premium will not be charged on such properties.  

This exception can be applied to properties such as purpose-built holiday homes or chalets which are subject to planning conditions restricting year-round occupancy or to protect local features, for example where the site is near a fragile habitat which requires protection at particular times of year. 

The government recognises the concern that some properties will have a very short restriction and therefore it may still be used as a main residence. Therefore, property owners will need to demonstrate that there is restriction in place that prevent occupancy for a continuous period of at least 28 days in any 12-month period. This exception will also cover properties that have a condition on its use, for example, specifying its use as a holiday let, or that it cannot be used as the sole or main residence.  

Some councils raised concern that the limitation on occupation may not prevent individuals from using the property as their sole or main residence. If the property is being occupied as their sole or main residence, then the property would not meet the definition of “Dwellings occupied periodically” and the premium cannot be charged on such properties.  

Other circumstances  

Question 13 – Are there any other circumstances in which properties should be an exception to either of the council tax premiums, and if so, why? 

Overview of responses 

Around two thirds of respondents did not provide a response to this question. Of those who responded, there was a split between those who did not feel that any other exceptions were needed and those who felt that there were other circumstances that may merit exception from the second homes premium.  

Detailed comments 

• Several councils commented that properties that cannot be sold or let due to circumstances (such as a restriction that needed to be resolved or issues due to access to roads or water) and second homes that are used to support access to medical care, should be excluded from the premium.  
• One council suggested that properties that cannot be sold or rented due to unsafe cladding issues should be excluded from the premium.  
• One council commented that a property that is unoccupied due to protected species should be excluded.  
• Several councils and landlords suggested that there should be an exception for landlords in-between lets or where the dwelling is not capable of being occupied all year round.  
• The Institute of Revenues Rating and Valuations suggested a two-year exception for properties that are difficult to sell – such as retirement properties or those for disabled people.  
• One council suggested giving discretion to councils to define their own sub-classes within empty home and second home definitions, so that they can apply differential levels of charge. For example, different rates between well maintained second homes compared to those which are a site for nuisance or anti-social behaviour.  
• One council commented that an exception should also apply to temporary furnished accommodation owned by a charity, registered provider, or local authority.  
• One council commented that when purchasing a long-term empty property, additional work (which is not considered “major repairs” or structural) may be required – and proposed an exception period for a limited time until the property is furnished/occupied. Otherwise, this could deter people from buying long term empty properties. 
• Two councils commented that they currently provide a council tax discount for properties undergoing works to make them habitable for a person with a disability and has considered discounts for dwellings undergoing works to make them more energy efficient. In their view, these would not necessarily qualify as major repair works, so an exception class of their own should be considered by government. 
• Several councils suggested that listed buildings undergoing major repairs or structural alterations should be an exception to the empty homes premium for two years due to planning / conservation restrictions. 

Government’s response  

The government does not intend to introduce additional statutory exceptions at this time. Councils can continue to use their discretionary powers to provide a discount or reduction where they feel it is appropriate. Councils also have the freedom to choose whether to apply the premiums to their local area or parts of their local area, and also determine the appropriate level of the premium (as long as it is below the statutory threshold).  

The premiums are intended to be used as a tool to help address the impacts of second and empty homes. The premiums and are not intended to penalise owners of properties that may be difficult to sell (for example, retirement properties) or properties that are empty due to their particular use, for example, temporary accommodation for a specific use owned by a charity, registered provider, or local authority (such as domestic violence refuges or emergency housing). The government encourages councils to consider whether it would be appropriate to subject such properties to the premium, depending on the circumstances.