In the case of a flat that is a 99 year lease, and in the case of other properties a sale of the freehold is to be assumed. In neither case is the actual interest relevant, nor can price restrictions within that lease be taken into account. The case was settled on this basis with solicitors acting for all parties by means of a Consent Order of the High Court and the original bands were restored. Listing officers should not, therefore, reflect price restrictions in bands.
Even if, in practice, no contribution is actually required to be made for the upkeep of common parts, the valuation for banding purposes is to assume such an outgoing if the owner or occupier is entitled to their use. In such instances the amount of expenditure to be incurred should be estimated by having regard to how such a cost would be apportioned if actually demanded.
Service charges are not specifically referred to in the regulations and accordingly regard should generally be had to those which were actually payable or were deemed to be payable in the case of new property as at 1 April , and the extent to which they were seen to affect value. However, it should be noted that where a service charge includes an amount to reflect the cost of repairing a property whose state of repair is not consistent with the assumptions contained in Reg 6 2 e and f , then the valuation is to have regard to the assumed additional or reduced charge that would be required as opposed to the actual charge which was passing at 1 April There is a specific provision contained in the regulations concerning a dwelling which has been made suitable for use by a physically disabled person.
Reg 6 2 g states that if a dwelling contains fixtures to which the sub-paragraph applies, then such fixtures are to be assumed not to be included in the dwelling. Reg 6 4 identifies these fixtures as follows;. Consequently any fixtures which satisfy the criteria laid down in Reg 6 4 should be assumed not to be included in the dwelling, all fittings are already excluded under the general basis of valuation to be applied, see Fixtures which are designed to make a dwelling more suitable for use by a physically disabled person will be extremely varied but will include ramps, some sanitary appliances, rails, chair lifts etc.
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It is to be noted that the actual use to which such features are put is irrelevant when considering whether they are appropriate for exclusion. Where any fixture which has been designed to make a dwelling suitable for use by a physically disabled person does not add value to the property, it will not satisfy Reg 6 4 and must not be treated as a relevant fixture for the purposes of Reg 6 2 g.
Consequently, regard is to be had to the existence of the fixture and any reduction which it may cause when considering the appropriate band which should be ascribed to the property. This is a charging provision and not one of valuation. When considering the value of any dwelling the effect of any fittings is to be ignored. Only items which may be considered to be fixtures are to be reflected unless, in relation to physically disabled persons, they are excluded by virtue of Reg 6 2 g see The mere fact that an item may be fixed does not automatically mean that it is to be regarded as a fixture.
Similarly, simply because any item is not actually fixed does not necessarily mean that it is a fitting. Regard is to be had not only to the degree of fixing but also the actual purpose of the fixing. If the main purpose of the fixing is in order to allow the better enjoyment of an item, as opposed to trying to effect an improvement in the dwelling, the item is to be regarded as a fitting. Conversely, if an item which is not fixed is placed to effect an improvement to the dwelling it is to be regarded as a fixture.
This is a familiar concept to Rating, but not until that time for Council Tax. This decision showed that evidence for banding can be gleaned, not from primary sales evidence, but in that case from decided cases. Hence the need for primary sales evidence is not always necessary to prove a band in a list that has been established over time. In his decision the Judge said:. Thus, in relying on the later decisions, the tribunal is not relying on specific valuations; though it was specific valuations that underlay the subsequent decisions of the tribunal.
All dwellings are to be ascribed valuation bands for the purpose of S. It is case law, however, which tells us what this means in practice. In paragraphs , an analysis of the law was undertaken in relation to beneficial occupation. In these circumstances a relevant transaction is not necessary to trigger a band review where material increases have taken place.
A dwelling which is removed from the list because it becomes non-domestic property will cease to be a dwelling. If subsequently it becomes domestic property again and qualifies as a dwelling it will be treated as a new dwelling when brought back into a CT list. Any improvements which may have occurred will be taken into account as part of the new dwelling. Similarly a garage situated within the curtilage of a block of flats will not comprise part of a dwelling if, for the purposes of the Act, it would have formed a separate hereditament.
Communal facilities such as car parking areas, gardens, communal lounges at a block of flats or sheltered housing development will not generally comprise a dwelling in their own right but the value of such facilities will fall to be reflected in the market values of the individual units. In those instances where a facility is used by both owners of adjoining living accommodation, as a right of occupation of their respective hereditaments and individuals living elsewhere provided the latter use is not de minimis it will have been treated as non-domestic property, e.
Article 4 gives the listing officer a discretion in prescribed circumstances to treat properties which would otherwise form multiple dwellings as single ones. Reg 7 simply sets out an apportionment approach for the valuation of a composite dwelling but does not affect the basic assumptions.
The basis of valuation for any dwelling which is a composite hereditament or part of a single property which is a composite hereditament is contained in Reg 7 1 of The Council Tax Situation and Valuation of Dwellings Regulations NB Lotting — selling in parts - cannot be assumed as this would be inconsistent with the concept of the hereditament from which the dwelling is derived.
The definition of open market value does not specifically exclude either a special purchaser or marriage value. The banding of any property where any unlawful use is apparent should therefore take into account the value which the market would have placed on that use as at 1 April , e. For example, if the dwelling to be banded is a tenanted, local authority owned flat situated within a block of similar units or a tenanted cottage on a large rural estate, regard must be had to the actual nature of the occupation of the surrounding premises as at 1 April and any consequential effect on the vacant possession value of the subject dwelling.
Any dwelling, irrespective of its actual description and tenure, should be regarded as a flat if it satisfies the above definition. Due to a particular design or the fact that properties in a locality have generally been allowed to deteriorate, the state of repair which might reasonably be expected may be lower than that attaching to similar properties outside the locality. Such works would not constitute repair simply to make good the ravages of time but rather renewal or improvement and it cannot be assumed that they would be carried out. With effect from 1 April , article 2 of the Council Tax Exempt Dwellings Amendment England Order SI amends Class A of the Order SI to limit the exemption from Council Tax for a vacant dwelling subject to structural alteration or requiring or subject to major repair work, to a maximum of 12 months.
For the treatment of planning restrictions and restrictive covenants which attach to properties see 4. These factors may be reflected in the banding of a property only insofar as they may have affected its value at 1 April assuming they do not otherwise affect the physical state of the locality.
Permitted development is defined in Reg 6 5 as being development. Support for this argument may also be gained by considering the order of the assumptions in Reg 6 2 of SI No Weight to be given: Where a planning restriction is correctly to be taken into account the likelihood of getting the restriction lifted at the AVD should be reflected in arriving at the valuation.
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Agricultural occupancy restriction: If the restriction was attached to a property on or before 1 April , or imposed on a new dwelling during the life of a list any reduction in value caused by its existence should be reflected. Imposition or removal of planning restrictions to existing dwellings should be ignored as these are non-physical factors. The removal of an agricultural restriction should be ignored unless it is carved out from the main farm holding, in which case it will be a split from the main hereditament and be treated as a new dwelling with different boundaries.
Restrictive covenants in a freehold or long leasehold interest which would have an effect on the sale price of that interest, should be taken into account for Council Tax purposes and assumed to coexist with the hypothetical sale on the grounds that the dwelling must be valued on the assumption of a hypothetical sale of the freehold, or 99 year lease in the case of a flat.
The case was settled on this basis by solicitors acting for all parties by a Consent Order of the High Court and the original bands were restored. Listing officers should not, therefore, reflect such restrictions in price in bands. However it should be noted that where a service charge includes an amount to reflect the cost of repairing a property whose state of repair is not consistent with the assumptions contained in Reg 6 2 e and f then the valuation is to have regard to the assumed additional or reduced charge that would be required as opposed to the actual charge which was passing at 1 April Only items which may be considered to be fixtures are to be reflected unless, in relation to physically disabled persons, they are excluded by virtue of Reg 6 2 g see section It will be noted that the banding in this decision was 1 April which is still the base date in England for banding.
PN1 explains the meaning of Section 3 LGFA that creates the primary basis of a dwelling as a domestic hereditament. A hereditament is an old concept connected with rateable occupation, being a unit of property, either occupied or capable of occupation, to be shown in a valuation list. Thus the vast majority of dwellings comprise living accommodation in the form of houses, bungalows and flats, occupied by a single household.
The CDO is one of the most misunderstood pieces of council tax legislation. This purpose of this appendix is to increase understanding and consistency in its application. The CDO created principally two new kinds of dwellings, which are modifications to the hereditament rule.
Firstly, the introduction of the concept of the self contained unit SCU being a possible basis. More than one SCU found within a single dwelling is to be treated as a dwelling. Secondly, the concept of amalgamating multiple dwellings found within a single self contained unit, into a single dwelling.
Note — The following paragraphs set out the CDO with comments in italics to explain the meaning of each part of the Order or emphasize the importance of understanding its application The Secretary of State for the Environment, as respects England, and the Secretary of State for Wales, as respects Wales, in exercise of the powers conferred on them by section 3 5 a and b and section 2 of the Local Government Finance Act , and of all other powers enabling them in that behalf, hereby make the following Order—.
A single property is a single hereditament, ie a single occupation or household.
A multiple property is comprised of multiple hereditaments separate occupations or households. Both being within the primary meaning of dwelling in section 3. Comment: definition amended in , to relate to fixed property only. Thus caravans and boats are not SCUs, and are not covered by these provisions.
Comment: Every SCU found within a single hereditament or household will be separately banded as a dwelling. That means the total boundaries of accommodation occupied as a single unit by a person or persons enjoying paramount control of that accommodation. That could be a mansion with servants quarters and grounds, or an ordinary house with an annexe. A care home shall be treated as comprising the number of dwellings found by adding one to the number of self-contained units occupied by, or if currently unoccupied, provided for the purpose of accommodating, the person registered in respect of it in accordance with Part 2 of the Care Standards Act in relation to Wales, or Part 1 of the Health and Social Care Act , in relation to England, and each such unit shall be treated as a dwelling.
Comment: 3A was added in to treat registered care homes as special cases, by aggregating all the SCUs found in them, disaggregating only those occupied by the registered person. Care should be taken to identify the care home part on sites where there is also sheltered housing. In exercising his discretion in paragraph 1 above, the listing officer shall have regard to all the circumstances of the case, including the extent, if any, to which the parts of the property separately occupied have been structurally altered.
Comment: Requirements 1. Multiple Property. A single SCU, occupied in separate parts.
If either of these are not present, the paragraph cannot apply. The same definition of SCU applies here as defined in Article 2. This is quite wrong in law. Firstly identify section 3 dwellings, then the LO according to the proper exercise of discretion may aggregate parts into an underlying and recognisable SCU. Where structural alterations render the building or part of a building not recognisable as a single SCU then the LO is required to maintain separate bands.
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The basis of valuation of a dwelling which is a composite hereditament, or part of a composite hereditament, is contained in The Council Tax Situation and Valuation of Dwellings Regulations SI No as amended. The Regulations require a value to be attributed to domestic use of such dwellings. This practice note details the approach to be followed when placing a band on the domestic use.
The definition of a composite hereditament is contained in S. It provides that,. Hereditament is defined in S. The definition of a dwelling for Council Tax is contained in S.
Related Agricultural Valuations: A Practical Guide
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