Council Tax Material Interest - The Final Determination
Please note the below case relates to a statutory periodic tenancy only. For a continuing tenancy at the end of the term (like our tenancy agreements), see the case: Leeds City Council v Broadley  EWHC 1839.
This case applies to Wales using occupation contracts because a fixed-term contract can never “continue” and always ends before a new periodic contract starts (same as a statutory periodic tenancy in England).
CT v Horsham District Council (HB)  UKUT 617 (AAC) is a significantly important Council Tax case.
In Oyston v Leeds City Council – Valuation Tribunal for England – 4720M67692/244C, which was a First-Tier Tribunal case, it was held that a tenant remained liable for council tax if they failed to give proper notice or abandoned as long as at some point in the past a fixed term of at least six months had been granted. This was because the periodic tenancy after the fixed term was a “continuation” of the original tenancy.
However, in the High Court, MacAttram v. London Borough of Camden  EWHC 1033, the opposite was held because they said the periodic tenancy after the fixed term, in that case, was a brand new tenancy and so was NOT a “continuation”.
A tenant only remains liable for council tax if the tenancy they are on is one which “was granted for a term of 6 months or more”. If a periodic tenancy is a brand new tenancy, then it wasn’t granted for six months or more, but if it was a continuation of the original, then it was.
This case related to a council tax benefit and whether a claimant was entitled to benefit to cover a period whilst not occupying a property.
The Council contends, in reliance on the decision of a Valuation Tribunal in the case of Oyston v Leeds City Council (27 July 2011), that the interest which the Claimant had under her periodic tenancy was a “material interest”, as it had originally been granted for a term of six months or more. In that case, there appears to have been an initial grant of an assured tenancy for a term of six months, followed by a periodic assured tenancy arising under the 1988 Act, followed when the tenant ceased to reside in the property by a periodic tenancy which was not an assured tenancy. The Tribunal held, contrary to the council’s contention in that case, that the periodic tenancies were “a continuation of the original agreement and not three separate and different agreements, and it, therefore, followed that the tenant had a material interest ….”
However, the Upper Tribunal has preferred the reasoning given in MacAttram v. London Borough of Camden  EWHC 1033 and has stated:
… The Judge held that the periodic tenancy which arose after the fixed term was a new tenancy or leasehold interest rather than a continuation of the fixed term. That seems to me to be correct. By s.5(3) of the 1988 Act, the periodic tenancy is “deemed to have been granted by the person who was the landlord under the fixed term tenancy immediately before it came to an end to the person who was then the tenant under that tenancy.” The statutory periodic tenancy is not, in my judgment, some sort of continuation of the fixed term. Therefore it cannot be said that the periodic tenancy was one which was “granted for a term of six months or more.”
And continued …
… the definition of “material interest” requires one to ask whether the leasehold interest which the tenant has at the relevant time (i.e. the time when liability for council tax is being considered) was an interest which was granted for a term of six months or more. That, in my judgment, requires one to look at the time when that leasehold interest was granted. A yearly periodic tenancy would appear to suffice in that the initial grant will have been for a term of at least a year. However, the periodic tenancy in the present case will have been either a monthly or weekly one (see s.5(3)(d) of the 1988 Act), and therefore it, in my judgment, was not a tenancy granted for a term of at least 6 months.
That settles this question once and for all because this, combined with Superstrike, further confirms a statutory periodic tenancy created by section 5 Housing Act 1988 is a brand new tenancy.
Members using our tenancy agreements are unaffected by this decision. As long as the fixed term is for six months or more, the tenant will continue to be liable for council tax if they abandon or fail to give proper notice because they will have a “material interest”.
This is because our agreements do not “end, " and no new tenancy is granted. The periodic tenancy is simply a continuation, and no statutory periodic tenancy is created.
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In self-contained flats or houses, the tenant usually is liable for Council Tax. Landlords should inform the Council Tax section of the local authority in writing whenever someone moves in or out of their property or if it is empty.