Council Tax and Houses in Multiple Occupancy (HMO)

If you live in, rent out or manage a property where people rent rooms separately, this may count as an HMO.

Who must pay Council Tax

The owner is legally responsible for the payment of Council Tax. Tenants are not responsible, even if the lease says they will pay.

Definition of an HMO for Council Tax purposes

The Council Tax (Liability of Owners) (Scotland) Regulations 1992 (as amended in 2003) prescribe classes of dwellings where the owner is liable for Council Tax. An HMO is defined in the regulation as:

“A dwelling occupied, or which could be occupied, by persons who do not constitute a single household, and which is occupied by one or more persons each of whom:

(a) is a tenant of, or has a licence to occupy, part only of the dwelling; or

(b) has a licence to occupy but is not liable (whether alone or jointly with other persons) to pay rent or a licence fee in respect of the dwelling as a whole”

For Council Tax purposes, a property is an HMO if:

• two or more households can live there (such as unrelated adults renting rooms, and
• people rent or occupy only part of the property (such as a bedroom) and share facilities like a kitchen or bathrooms

You do not need an HMO licence for us to treat a property as an HMO for Council Tax. HMO licensing is a separate legal process and does not decide who pays Council Tax.

A property can count as an HMO, even when empty, as long as it could be occupied by 2 or more households.

More information on legislation is available at www.legislation.gov.uk

Lease agreements

Council Tax legislation overrides private lease agreements. If your lease says the tenant must pay for Council Tax for an HMO, we will still bill the owner.

Discounts and exemptions

Discounts and exemptions may apply based on who lives in the property. We look at everyone living in the property (not room by room). For example, a student exemption may apply if all the residents are students.

Council Tax Reduction (CTR)

CTR is for people who are liable for Council Tax and live in the property. As tenants are not the liable person in an HMO, tenants can’t apply for CTR at that address.

Tell us if the property is an HMO

• landlords - contact us as soon as rooms are rented out separately, or the number of households change
• tenants – if you have been sent a Council Tax bill, contact us straight away. We can check if the owner should be billed

By contacting us, this helps set the Council Tax account up the right way.

Backdating of HMO status

If you do not tell us a property is being used as an HMO, we may change the account later and bill the owner from the date the property started being used as an HMO. This can include past years.