Taxpayers could soon face significant increases on their council tax bills if their homes remain empty for extended periods. According to new regulations effective from April 2025, property owners across England and Wales may incur additional council tax charges—which can rise up to 300% for homes unoccupied for over ten years.
Currently, properties empty for more than 12 months attract up to 100% surcharge, reaching £3,900 annually for band G properties, as highlighted by Matt Crawford, partner at the audit and tax advisory firm Blick Rothenberg. If the property has sat vacant for five years, the surcharge increases to 200%, amounting to approximately £7,800.
“Council tax bills will be landing on doormats across the country over the coming months, but many people are unaware of these surcharges,” Crawford cautioned. Homeowners need to be informed of the potential financial burden these premiums bring.
From April 2025, local authorities will have the power to impose additional charges, which will also affect properties considered ‘periodically occupied,’ primarily those utilized as holiday homes. The 100% surcharge would significantly impact these owners, creating another layer of financial obligation.
“It is important for owners of empty properties to be aware of the changes,” Crawford stated. He emphasized the importance of property owners taking proactive steps to mitigate these charges, especially those considering re-entering the rental or sales market.
To protect themselves, owners must actively market their properties at reasonable prices to qualify for potential exemptions. “You must provide enough evidence to validate your exemption,” he urged, referencing expected audits by local authorities.
Property owners are advised to keep evidence of valid market listings and third-party valuations. This may include screenshots from estate agent websites or property portals showing active marketing efforts.
For those relying on the exemption from additional premiums, it is also important to note the limited relief period. Homeowners must demonstrate the property is on the market for sale or rental within 12 months to avoid extra charges.
This crackdown on derelict homes is part of wider efforts by local councils to encourage property use and curb the housing crisis affecting many regions. With housing supply dwindling, local authorities are increasingly focused on the effective utilization of existing homes.
While property owners look for ways to negotiate these new charges, it’s imperative they remain compliant with the safeguarding measures to avoid punitive financial penalties. With substantial numbers of homes remaining vacant across the country, the pressure mounts for owners to address the tax consequences directly.
Looking forward, it remains to be seen how successful councils will be in implementing these policies and managing local responses. The ramifications of increased taxation on empty properties are likely to prompt renewed discussions around housing availability and the responsibilities of property ownership.
The shift marks another significant change within the property sector as owners adapt to new demands from regulatory authorities. Homeowners considering selling or renting must now strategize accordingly, balancing market realities with regulatory expectations, all the time cognizant of the potential financial fallout of being unoccupied.