Under new plans being proposed by the Government, local authorities would be able to charge landlords council tax on an empty residential property.

Currently once a domestic property falls vacant, the owner is granted a mandatory period of six months before council tax becomes payable. However Ministers want to abolish this and under the Localism Act replace it with a clause that will allow local authorities to charge whatever they want to on empty homes for the first six months. So in effect they could charge nothing or 100% of the possible council tax liability.

Ian Sanford, of Pennington Homes, said: “With local authority finances under pressure in the present recession it is more than likely that authorities will choose not to grant council tax-free periods, which will have major financial implications for landlords and vendors alike.

“In addition, it will provide an additional administrative burden for letting agents in that they will have to advise local authorities of all vacant periods, most of which are often only of a duration of a few days. It is also likely that, in these cases, it will cost the local authority more to collect the small amounts than the additional revenue achieved.”

The actual proposal is to abolish the Class C exemption for council tax purposes.

Class C dwellings are empty homes that are largely unfurnished. Other classes, which would appear to remain untouched by the latest moves, include homes left empty after someone has become ill or because the property is subject to probate.

Of the Class C category, the Government says ‘there is no compelling reason why the first six months should be treated so generously’