Council tax and lodgers

Me and my girlfriend (both full-time students) will rent a flat. Probably, we will also have two friends living with us for some time, paying half of the rent to us for the time they stay there (no contract - cash). They are not students, nor UK-citizens.
Can we get a problem because of this with:
a ) The landlord - is it considered lodging/sub-letting, where is the line(for example, it must be okay if i'm the only one on the contract with my girlfriend paying her share to me). Do most landlord bother?
b ) The council - will they require us to pay council tax if they get to know that our friends stay there? They will probably be working and having a social security number, but not "register" on our adress.

If I apply for council tax exemption claiming that only me and my girlfriend are living in the flat, is it a criminal offence if its true at the time and what penalty is it. Or is this reporting done by the landlord, to whom we appear to be the only residents?

Reply 1

N_n_N

if they dont register on your address and you give only yours and your gfs names to the landlord when signing all the papers than it cannot be a problem..

but if the landlord is a pain then he/she might follow who visits the house and who stays there and concludes there are more ppl living; he/she might cause trouble.

Reply 2

Paeony

Most landlords do not like you to sub let. You'll also find that if you sign a standard AST it'll be one of the conditions that you don't, so, if you break the terms of your tenancy agreement, you could find yourself being asked to leave - not really what you need during your degree. At the very least, the landlord is unlikely to renew your contract (which is likely to be for six months initially), which ultimately will cost you more money as you'll have to fork out again to move. I also believe that in cases like this an exchange of monies does constitute a form of contract between you and the person you sublet to (although I might be wrong there) so you can't wriggle out of this by saying there's no contract. Also, going off my own experience with lettings agents/landlords, they will not be happy if you move in non-UK residents as it's impossible to chase them for monies/damages etc. If you are a non-UK resident hoping to rent in the UK, any reputable landlord will insist on a UK based guarantor or rent up front. I mention this because it's one of the reasons why what you're doing WILL annoy your landlord.

On another point, you are risking your own deposit doing this. Remember that YOU will be held liable for any damages, bills etc etc. If you sublet to someone illegally then you've absolutely no comeback should they damage the property or run up massive bills - YOU, as the legal tenant, will have to pay.

It is up to you to sort out the council tax and the exemptions. If you claim that only you and your girlfriend are living there and this is found not to be the case, then the ultimate penalty for council tax evasion is prison. Ironically, council tax evaders are the only prisoners who still have to pay council tax in prison. If your friends are working and have a national insurance number then at some point they are going to have to give an address - do not assume that it'll never be found out that they're living with you, it will. Councils do not look kindly on people who try to evade paying council tax.

I don't mean to sound harsh here but what you're proposing to do is dishonest, and it's one of the reasons why even good tenants (students especially) are treated with such suspicion by landlords. You're really not helping yourself if you try to defraud people.

Reply 3

C-O.M

So, is the duty not to have other ppl living there based on a contract clause,
i.e. no clause prohibiting other people to live there and i can have other people living there. (
No clause prohibiting lodging i can let them pay their part? Is it usually hard to negotiate away if present?

As regarding council tax, I meant at the time searching exemption when we probably are living alone (since i guess the landlord only report new residents with a new tenants) Am I legally obliged to report if other people move in after that and is it an offence not to?
I'm not trying to evade, but rather avoid, council tax as long as possible without commiting any offences. What counts as living and not just staying?

I'm not worried for my deposit or anything, since my friend are well-behaved and their parents good friends of my parents etc. The main reason why we want only me and my girlfriend on the contract is that we are staying the whole academic year, whereas our friends only stay 3 months and have no bank/reference anything in the UK. And we are counting on paying quite a few months rent in advance, and if they want to chase anyone we are readily available, and of course I understand that I'm fully liable for everything my lodgers do.

Reply 4

Paeony

C-O.M

No clause prohibiting lodging i can let them pay their part? Is it usually hard to negotiate away if present?

Am I legally obliged to report if other people move in after that and is it an offence not to?
I'm not trying to evade, but rather avoid, council tax as long as possible without commiting any offences. What counts as living and not just staying?

It's generally not that easy to negotiate the clause about sub-letting out - it's generally there for a reason as there are rules about how many people can be living in a certain place. If you move too may people in, your landlord can face fines, his insurance can become invaild and he is legally obliged to provide certain things that he would not ordinarily have to have in the property, like fire doors, fire escapes and sinks in every room. Also, letting is a business, most landlords would be suspicious that you were trying to make a profit from their flat. Most landlords would not be happy if you wanted to sub-let. You could try talking to your landlord and explaining the situation. If it is genuinely only for a few months, they may agree. However, it's likely that they'll check up on you frequently and come down on you like a ton of bricks if they discover that people are staying there for longer than you said. Many landlords will not take the risk, and if you ask about subletting while looking at a flat it'll probably put them right off you.

Yes, you are legally obliged to report any people who move in permanently and yes, it is an offence not to. Anyone who is working and living in the UK is liable to pay council tax, I've had a good look and there's nothing about exemptions for foreign nationals. I'd imagine that if they're working in the UK, it will count as living rather than visiting from as soon as they move in - as I said before it's going to be almost impossible for them to avoid giving an address and they'll be paying tax (assuming they're working legally), so the council will find out where they are fairly rapidly.

Reply 5

C-O.M

So should I put like that we all want to move in, but that only me and my girlfriend wants to be on the contract, because we are the only one who are sure that we want to stay the full year?
Is it that unusal to want to share a one bed (reception used as second room and separate kitchen) four people in London?
Olof

Reply 6

Paeony

You're not going to find a legitimate landlord who will let four people rent a one bed flat, legally it'll be overcrowded. However, you might find someone who is willing to do this but it's likely that it won't be a very good flat maintenance wise.

You'd probably be better looking to rent rooms in a house, and each taking separate contracts for the length of time you want to stay there. However, it's going to be very difficult to get a contract for less than six months. Your friends might be better off looking for short term lodgings - I don't know where your friends are from but if they move to an area where there's a big community of their nationality, they'd easily find rooms to rent for a short time and you wouldn't be bothered with problems over subletting and council tax. My personal view of the situation is this - you're a student, so you're likely to be needing somewhere to stay for at least a year (you say a year so I'm assuming you're a postgrad). It costs an absolute fortune to move, when you factor in agency fees, deposits, moving etc etc, so it's silly to jeopardise your place to live over this. Constant moving, especially when you're a student isn't nice, and ultimately it could affect how well you do in your degree.

Reply 7

C-O.M

As i understood the laws it's okay as long a both rooms are bigger than 10.2 square meters, which we will have to get.
They are currently lodging on 1 months licences, and if that is okay, I dont see why they couldnt lodge with us instead. It's nicer and safer to share with people you know, and we both save money because we can share the rent and they get a fair share of the rent (as opposed to current lodging).
Of course I don't want to jeopardize my flat or renting-market reputation, that is why I ask beforehand.
If it is no legal prohibition, it should be possible to solve with an extra fee or something? This is an example of what I'm thinking of: http://atkinsonmcleod.com/incoming/797623082_fl_0_resized.jpeg . That would give us all more space than I hade in my 8 SqM hall room last year, and surely a higher de facto standard.
Olof

Reply 8

Paeony

Like I said, it's up to the landlord - it's impossible to give you a definitive answer here because yes, you may be allowed to do what you're proposing, or you may not. My advice is to ask beforehand, and don't just assume that it will be ok. Where a landlord might have said yes, they'll definitely be annoyed if you do it without asking.

I don't know what kind of contract you or your friends currently have, but if you want to rent a flat for an extended period of time, it's usual to sign an Assured Shorthold Tenancy (AST). These generally can't be issued for less than six months, and have a number of clauses in them that legally you are obliged to observe (the clauses on subletting I mentioned earlier, for example).

It's really going to be up to you to find out if you are going to be able to do this. The best advice I can give you is that you start looking sooner rather than later and that you don't seek to hide anything from a landlord or the council. I'd also suggest that you start saving as it's possible you may have to pay a larger deposit or rent in advance. You are also going to have to be able to prove that you can cover the rent yourself without the contribution of your friends, as one of the things they will generally check before letting you rent somewhere is your capacity to pay. A landlord might become anxious if they felt that you might not be able to afford to pay if your friends moved out, so you might want to think about how you're going to present that.

Reply 9

C-O.M

Me and my girlfriend have money enough to pay 6 months in advance which i hope will be sufficient. I guess a possible guarantor need to be based in the UK, which our parents are not, so thats not a possibility.
I have now looked at a "standard" AST, were you fill in the names of the residents. Perhaps you just can demand having them included as residents at that point. But in these negotiations, have you already handed over a holding fee? Should/can you request a written confirmation that the holding fee will be given back if the two extra residents are not allowed by the landlord. (I plan to go through an established agent because we will have to hand over a huge amount of money if we pay 6 months rent in advance)
Are there any lists with reviews etc of estate agents?
Olof

Reply 10

kftjkp

The people who are going to be living with you would have to give the DWP an address (which has to be a home address not a PO Box/Business address) to get a social security number, so they couldn't live at your house without the council knowing thus making you liable for council tax. Therefore what you are proposing to do is illegal and not appropriate for discussion on TSR.

Reply 11

C-O.M

Okay, thanks. I dont know how it works because I dont have a UK-number, and wonder how you do if you are lodging around.
However I find the system being quite strange, if students are exempt from council tax, why should it be full council tax on a property were half the property is occupied by students....
It would have been easier to accept if everyone paid full. What is the approximate council tax on a small apartment in london?
Olof

Reply 12

Paeony

Thank you, kftjkp :smile:

I'm not sure where you're planning to move to but it's unlikely that you'll be able to 'demand' anything from your landlord lol ...

If you go through a letting agent, what usually happens is that you discuss any potential problems/changes BEFORE you hand any money over. Then if the letting agent believes that you stand a fair chance of getting the property, it's usual to be asked for a 'holding fee', so the the property can be taken off the market - I've just paid £200 for this, but it varies from place to place. In the past, I've paid up to £300. With some agencies, this will go on to form a part of your deposit should you get the property. With other agencies, it doesn't, so it's worth asking about this. Importantly, it's usual that if you decide you don't want the property and pull out, you loose this money. If, for whatever reason the landlord decides not to let to you, you *should* get this money back, although with some less scrupulous agencies it can be a fight. So, in your case, ask about extra residents BEFORE you hand over this holding fee. Personally, if the landlord has agreed in principle to the extra residents, I'd get this confirmed in a letter or email so that this cannot be used against you in the future. On top of this, you will have to pay for reference checks for each and every person you wish to be included on the tenancy, and you will also have to pay for the guarantor to be referenced checked too. The cost of this varies - I've recently had to pay £65 per person, I've heard of some agencies charging £150 per person. Again, ask about fees and charges before you hand any money over.

If you do pay any money in advance over and above the usual deposit, make sure that you have a receipt for this in writing. Also ensure that your deposit is protected in one of the new schemes.

The best way to find a good letting agency is to ask around, if you know anyone in the area you want to move to. Tbh though, you're going to have to do quite a lot of ringing round - Rightmove and Findaproperty are good websites to use to get lists of agents. In my dealings with agencies, I've found that it helps to go off gut feeling - if they're rude with you, or dismissive, or show you grotty properties then walk away, because if that's how they treat you now it'll only get worse when you're a tenant. Also, when you're looking for a property it's so much better if you can actually physically go into the offices, rather than ringing - if they see that you look reasonably smart and reasonably intelligent, you stand a much better chance of negotiating to suit yourself, and they're more likely to listen to you if you have slightly unusual needs, like yourself.

Sorry if I'm telling you things here that you already know!

Reply 13

Paeony

C-O.M

Council tax is based on two adults in a property. Since students are exempt from council tax, it would be usual for a property with two students and two working adults to be charged full council tax, because for taxation purposes only the working adults would be counted.

Council tax varies from borough to borough and is dependent on the value of the property. At a guess, I'd say that the council tax for an average one bedroom apartment in London will be in the region of £1000 per year. There are two really cheap boroughs in London (Wandsworth and Westminster) where the council tax is substantially lower, about half of what it is elsewhere, but you tend to have to pay a bit of a premium to rent here because of that, and properties tend to be harder to find because the low council tax is attractive to renters.

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