Wednesday, 8 August 2012

Landlord scams (4)

Continuing the theme of the previous posts, one landlord scam goes as follows:

1. Tell the tenant that the rent is inclusive of Council Tax, so the rent can be increased by £50 - £100 per month.

2. Don't pay the Council Tax.

3. Wait until the tenant has moved out and then inform the council of the tenant's new address and the council will then chase the former tenant. The law is broadly that the Council Tax is payable by the occupant, not the person registered at HM Land Registry.

4. The landlord profits by the extra rent he charged, which was supposed to cover the Council Tax.

5. Some tenants do the same in reverse, i.e. they don't pay the Council Tax while they are there, and then do a disappearing act, so as a default, the council will chase the owner/landlord for the Council Tax.

As the law stands, there is a little that the defrauded tenant (or landlord) can do in such a situation, however there are things which local councils can do administratively to prevent this happening.

YPP councils would work on the basis that the primary liability to pay the Council Tax is with the registered owner. If the landlord and tenant agree (for whatever reason) that the tenant will pay, they will have to both sign and submit a declaration to that effect. The council will check that the purported landlord is in fact the registered owner of the home and liability to pay will transfer to the tenant when he receives confirmation from the council (and no earlier).

Some tenants will prefer this method; if they receive the notification from the council that, then this is their confirmation that the purported landlord is the actual owner.

Similarly, it is far more convenient for all parties - the owner/landlord, the tenant as well as the council - if the primary liability remains with the landlord and he adds it to the rent, leaving the tenant with a single monthly or weekly payment and no need for two re-registrations every time a tenant leaves and a new tenant moves in.

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