Summary: Mr X complains about the Council’s handling of two council tax accounts. The Council was entitled to make a determination which of his two properties was his sole or main residence. The Ombudsman cannot intervene in the decision the Council reached.

The complaint

1. Mr X and wife own two homes, their ‘marital home’ where they currently live, and a second property that has been empty for several years (‘the empty property’). Mr X complains about the Council’s handling of his council tax on the two properties. Mr X complains:
• The Council has applied surcharges on the empty property without giving advance warning.
• When he was struggling to pay the council tax bills an advisor at the Council’s ‘Hub’ gave him advice that he move back into the empty property so he and his wife could both claim a single person discount and reduce council tax payable. However, when Mr X investigated this via an online ‘chat’ function on the Council’s website, an officer said the Council would continue to treat the ‘marital home’ as his main residence as he was moving only to avoid the charge and the Council would not discount the bills for either property.
• It is not for the Council to decide where he should live, he wants a declaration from the Ombudsman that the Council has no legal right to tell him he was not allowed to move back to the empty property and for the Council to agree he has flexibility to live in either property.
• The Council has the right to waive the premium on the empty property and has not properly considered doing so.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. The Local Government Act 1974 sets out our powers but also imposes restrictions on what we can investigate.
4. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
5. The law says we cannot normally investigate a complaint when someone can appeal to a tribunal. However, we may decide to investigate if we consider it would be unreasonable to expect the person to appeal. (Local Government Act 1974, section 26(6)(a), as amended)
6. The Valuation Tribunal deals with appeals against decisions on council tax liability and council tax support or reduction.
7. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

8. I have considered information provided by Mr X and the Council. I also spoke to Mr X about the complaint.
9. I have considered the relevant legislation, and council policies set out below.
10. I have considered the Valuation Tribunal guidance manual that is publicly available online and which the Council referred to in its complaint response. The guidance manual provides examples of case law some of which I have referred to below.
11. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Relevant law

12. The Council has a duty to charge Council Tax in accordance with legislation and to determine who is liable for the charge and the level of the charge for a property.
13. The amount of Council Tax payable depends on:
• The valuation band of the dwelling
• How much the local council charges for that band
• Whether there are any discounts or exemptions that can be applied.
14. Councils may apply a discount if the property is empty, if only one adult lives there, or if one or more of the people in the home should be ignored for special reasons.
15. Council tax is usually based on at least two adults living in a home. Spouses and partners who live together are jointly liable for paying the bill. Adults who live on their own can get a 25% reduction off the bill if no-one else in the home counts as an adult.
16. If someone is on a low income, they may also be able to apply for a reduction under the rules of the local council tax reduction scheme.
17. A person charged council tax can appeal to the Valuation Tribunal:
• If they think the property is exempt from council tax
• If they think the property is in the wrong valuation band
• If they do not think they should be liable for council tax
• If they think the Council should give them a discount
• If they think the Council should have given them a reduction under the rules of the local council tax reduction scheme or they disagree with the reduction the Council has given.
18. If someone applies for council tax reduction or a discount, a council must advise the claimant of its decision in writing. Appeals against decisions about council tax reductions must be heard by the Valuation Tribunal. Before a claimant can appeal to the Valuation Tribunal, they must ask the council to look again at its decision.
19. If a council refuses to change its decision, or has not replied to the claimant within two months, the claimant can appeal directly to the tribunal. The time limit to appeal to the tribunal is two months after the council has given its written decision.
20. The Ombudsman cannot normally investigate complaints about councils not awarding council tax reductions, discounts or exemptions because the complaints should be heard at the Valuation Tribunal. However, the Ombudsman can look at councils’ actions and what happened surrounding the complaint.
21. Section 6 of the Local Government Finance Act (LGFA) 1992 provides a list of people liable to pay council charge for a property. Where a property is unoccupied the liable person will be the owner of the dwelling.
22. Section 6 defines a ‘resident’ as an individual who is over 18 years of age and has his sole or main residence in the dwelling. The concept of sole or main residence was introduced by the LGFA 1988, but was not defined in the 1992 Act. It was left to the High Court to interpret the meaning of the phrase sole or main residence through appeals brought against tribunal decisions.
23. The Courts have found that various factors should be considered in determining sole or main residence. The Valuation Tribunal (VT) guidance manual referred to above includes examples of factors that courts have considered:
• Time spent at a property
• Where a spouse or other family members reside (Cox v London South West Valuation Tribunal HC, 1994, Doncaster Borough Council v Stark HC, 1998)
• Whether a property was available for a person to return to, for example where someone spent a long period abroad the property remained their sole or main residence even though furniture removed would need to be put back in to make it comfortable. (Navabi v Chester Le Street Council. 2002)
24. At paragraph 10.3.1 of the 2018 VT Manual is an example of a similar case to Mr X. It involved two taxpayers, Mr Clayton and Ms Mullaney who each received a 25% discount in respect of two separate dwellings. The Council determined they lived in one dwelling, removed the single person discount from Mr Clayton and and instead awarded a 50% no resident dwelling on Ms Mullaney’s property on the basis it was no-one’s sole or main residence (Mullaney v Watford Borough Council and Hertfordshire VT and Clayton v Same HC, 1997) The High Court considered evidence about which property was Ms Mullaney’s main residence including early morning surveillance reports, benefit investigation meetings and the location of Ms Mullaney’s possessions. The court upheld the Council’s decision the couple shared the same main residence.

Chronology of events

25. Mr X and his wife lived in the now empty property for several years until 2013 when they moved to their current address. They intended to modernise the property for sale and understood they would have to pay council tax on two properties until it was sold.
26. In 2015 the Council added a 50% empty property surcharge to the property as it had then been empty for two years. Mr X said he had no notice of this.
27. In 2018 Mr X became unemployed after a period of ill-heath. He has not returned to work. Due to his wife’s income he is not entitled to income benefits. Mr X says since 2018 they have lived off his wife’s income and their savings and have been under extreme financial pressure which has had an adverse impact on his mental health.
28. In April 2019, the empty property surcharge increased to 100%. Mr X again says this happened with no warning. Mr X says he was distraught about paying the two bills and sought advice from the Council’s advice ‘Hub’. He says he was advised that if he moved back into the empty property he could claim a single person discount of 25%, the surcharge would not apply, and his wife could claim a single person discount on the marital home. Mr X says he was shocked by this suggestion but realised this would significantly reduce the financial pressure on them.
29. Mr X said to explore his options he used the Council ‘chat’ facility on its website. He told the officer he was being forced to move back to his old home which had no working bathroom as he was currently paying over £5000 per year in council tax.
30. The officer advised Mr X would need to complete a moving within area form and asked how he planned to live in the other property without a bathroom. Mr X explained he felt he had no choice due to his financial situation. He said the move would be temporary and he would keep his belongings at the marital home and return there from time to time.
31. The officer said based on this information the Council would continue to treat the marital home as Mr X’s main residence as he was moving only to avoid the charge. Mr X said he and his wife were having some difficulties and a temporary separation would be helpful. Mr X said the Council had to accept the move and if it refused to do so he would raise this as a legal matter. Mr X said the officer should amend the records to show the marital home as his wife’s sole property and the ‘empty property’ as his sole residence. He said the Council’s website allowed couples living separately to stay away from their main residence for three to four nights a week without affecting their single person discount, so it was unfair to treat him differently.
32. The officer was not willing to amend the record and said it was clear Mr X’s intention was to reduce both accounts. If Mr X was on a low income the officer said he may be eligible for a discretionary discount.
33. The Council wrote to Mr X about bringing the empty house back into use. Mr X advised his ill-health was the reason the property had not been completed, although progress has been made in the last year.
34. In March 2020 Mr X received the next year’s bills and the empty property surcharge had increased to 200%.
35. Mr X asked the Council to postpone the surcharge as the empty property was almost ready for sale and instead apply the standard charge. Mr X wanted the Council to confirm he had the flexibility to live at either property.
36. To date Mr X has not moved out of the marital home. He told me if he did so this would lead to water rates being incurred at the other house and he could not afford to incur more cost without confirmation from the Council it would change its position.

Complaint response

37. The Council reviewed both of Mr X’s council tax accounts. It said to calculate his charges it had to determine which was his sole or main residence. Couples who were married were considered to have one main home together. Where a person has more than one property the Council will take many factors into account including why they have two homes, where their partner or children live, legal ties to each address, bills and accounts registered at each home, the address used for registering with health services, whether a person intends to return to another home and which address is the most settled one.
38. The Council has set a surcharge for properties empty more than two or five years. Mr X had been charged in line with the surcharges set by the Council. The Council had an empty home team who may be able to help Mr X bring the property back into use.
39. The Council said while its webchat adviser had told him there was help for those on low incomes, this did not apply to second homes.
40. In its response to me, the Council denied Mr X had been given advice by the ‘Hub’ to move into the empty property. It said this is not advice an officer would give, and any advice given would have been recorded on the file. There was no entry for the conversation Mr X refers to.

Analysis

41. Mr X says the Council told him he was not allowed to move back to the empty property and the Council should agree he has flexibility to live in either property.
42. I find this is not what the Council said. The Council cannot prevent Mr X staying in either or both properties. The Council can however make a determination, based on the evidence at the time Mr X applies for a reduction, which of his properties it considers to be his sole or main residence. This may not be the property where a claimant spends most of his time if the Council considers that where a spouse lives, belongings are kept and where someone intends to return in future is their main home. Decisions will turn on the facts of each case. The caselaw set out in the Valuation Tribunal guidance manual confirms this.
43. It is not for the Ombudsman to determine which would be Mr X’s main residence. That is a decision for the Council against which Mr X would have a right of appeal, which we would expect him to use.
44. Councils consult on their budget each year and information about the council tax policy and any changes to rates, discounts and exemptions are available on the Council’s website. Consultations and decisions about council tax are publicly available, as are minutes of the meetings where decisions about council tax rates and on the budget for the forthcoming year are made. Local newspapers will also often report on proposed budgets. While Mr X complains about lack of warning, this information was publicly available.
45. The Council’s council tax leaflet explains that it differentiates between second homes, which are furnished, and empty homes which are unfurnished. Newly empty homes can receive a discount for a short period, but second homes which are furnished but unoccupied cannot. Surcharges are applied to long term empty homes that stay empty and unfurnished for more than two years.
46. As Mr X’s other property was empty, unfurnished and required work in 2019 when he approached the Council it was treated as an empty property not a second home. If this situation were to change when works are complete, Mr X could ask the Council to disapply the empty home surcharge and charge the standard rate. If the Council did not agree to do so, Mr X could challenge this at the Valuation Tribunal.
47. The Council has the right to charge premiums on empty houses and its policy on this can only be challenged by way of Judicial Review.
48. There is not enough evidence to determine what advice may have been given at the Council’s Hub. Mr X and the Council give conflicting accounts and there is no contemporaneous record, this is one person’s word against another.
49. As Mr X had savings above the level of eligibility for the Council Tax Reduction Scheme he was not eligible for this support.

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Final decision

50. The Council was entitled to make a determination which property was Mr X’s sole or main residence based on the evidence he provided at the time he asked the Council to consider a reduction. If Mr X’s circumstances change in future he can make a further request for a reduction, or for the Council to remove the empty home surcharge. If he remains unhappy with the Council’s decision, he can challenge this at the Valuation Tribunal.

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Investigator's decision on behalf of the Ombudsman