Liability for Council Tax arises primarily in respect of dwellings. Section 3 of the Local Government Finance Act 1992 (LGFA 1992) defines "dwelling" in terms which begin with the concept of a hereditament for rating purposes. Broadly any property which, by virtue of the definition of hereditament in section 115(1) of the General Rate Act 1967, would have been a hereditament for the purposes of that Act if that Act remained in force, is a dwelling unless it is non-domestic property (section 3(2)). This aspect is explored more fully in Practice Note 1, paragraph 2 – Definition of Dwelling
Therefore, it is important to realise, even before the concept of disaggregation is considered at all, that the number of hereditaments (i.e. units of actual occupation) in a particular property must be determined.
The disaggregation provisions require to be considered only when a single hereditament appears capable of occupation by more than one person or household.
The first question to be asked, therefore, is “What is the hereditament?”
The concept of a hereditament is clearly linked with the concept of rateable occupation, and in most cases the hereditament will simply be defined by the extent of a person's rateable occupation. Contiguous property that is all in the same occupation will normally constitute a single hereditament, and the area to be taken must be sufficiently defined. Further guidance can be obtained from the leading case of Gilbert (VO) v Hickinbottom & Sons Ltd. R & IT 1956 Volume 49 P251.
If within a property there is any unit of occupation which would have formed a hereditament in its own right for the purposes of the 1967 General Rate Act, then it is a dwelling, irrespective of whether or not it is self contained.
Accordingly, if each individual dwelling within a property is found to be a hereditament in its own right, it should be banded as such and the disaggregation provisions do not apply.
In some circumstances, more than one unit of living accommodation can be found within a single hereditament. Also, a composite hereditament is also a dwelling, in its entirety (section 3(3)). This definition means that in some cases there will be dwellings which comprise several separate units of domestic accommodation which nonetheless constitute a single hereditament by virtue of the rules of paramount occupation.
For Council Tax purposes such dwellings are to be split up, or disaggregated, where there are separate units of self contained accommodation. This is provided for by The Council Tax (Chargeable Dwellings) Order 1992 SI No. 549 ("the Order") as amended by The Council Tax (Chargeable Dwellings, Exempt Dwellings and Discount Disregards) Amendment Order 1997 SI No 656.
Section 3 of the LGFA 1992 states:
(1) This section has effect for determining what is a dwelling for the purposes of this Part.
(2) Subject to the following provisions of this section, a dwelling is any property which -
(a) by virtue of the definition of hereditament in section 115(1) of the General Rate Act 1967, would have been a hereditament for the purposes of that Act if that Act remained in force; and
(b) is not for the time being shown or required to be shown in a local or central non-domestic rating list in force at that time; and
(c) is not for the time being exempt from local non-domestic rating for the purposes of Part III of the Local Government Finance Act 1988 ("the 1988 Act");
and in applying paragraphs (b) and (c) above no account shall be taken of any rules as to Crown exemption.
(3) A hereditament which -
(a) is a composite hereditament for the purposes of Part III of the 1988 Act; and
(b) would still be a hereditament if paragraphs (b) to (d) of section 66(1) of that Act (domestic property) were omitted,
is also, subject to subsection (6) below, a dwelling for the purpose of this Part.
(4) Subject to subsection (6) below, none of the following property, namely -
(a) a yard, garden, outhouse or other appurtenance belonging to or enjoyed with property used wholly for the purpose of living accommodation; or
(b) a private garage which either has a floor area of not more than 25 square metres or is used wholly or mainly for the accommodation of a private motor vehicle; or
(c) private storage premises used wholly or mainly for the storage of articles of domestic use,
(d) is a dwelling except in so far as it forms part of a larger property which is itself a dwelling by virtue of subsection (2) above.
(5) The Secretary of State may by order provide that in such cases as may be prescribed by or determined under the order -
(a) anything which would (apart from the order) be one dwelling shall be treated as two or more dwellings; and
(b) anything which would (apart from the order) be two or more dwellings shall be treated as one dwelling.
(6) The Secretary of State may by order amend, or substitute another definition for, any definition of "dwelling" which is for the time being effective for the purpose of this Part."
This Order has been made under Section 3(5) LGFA 1992 and provides for both the aggregation and disaggregation of dwellings in specified circumstances (see Practice Note 6 regarding aggregation).
Article 3 of the Order provides:
"3. Where a single property contains more than one self contained unit, for the purposes of Part I of the Act [LGFA 1992], the property shall be treated as comprising as many dwellings as there are such units included in it and each such unit shall be treated as a dwelling."
Article 2 of the Order provides:
"single property" means property which would, apart from this Order, be one dwelling within the meaning of section 3 of the Act.
As from 1 April 1997 the definition of self contained unit was changed to mean
"a building or part of a building which has been constructed or adapted for use as separate living accommodation".
Caravans and boats cannot, therefore, be disaggregated so that a caravan or boat included in a single property is not treated as a separate dwelling.
As from 1 January 2004 in England a new article 3a is inserted after article 3 by article 2 of the Council Tax (Chargeable Dwellings,Exempt Dwellings and Discount Disregards) ( Amendment) (England) Order 2003 SI 3121.
As from 1st April 2005 in Wales the same provision is enacted by the Council Tax (Chargeable Dwellings, Exempt Dwellings and Discount Disregards) (Amendment) (Wales) Order 2004.
Article 3a states:
“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 2000, and each such unit shall be treated as a dwelling. “
This provision gives registered care homes (within the meaning of part 2 of the Care Standards Act 2000) a special concession in the method of calculating the number of dwellings for banding. The total number of dwellings will be found (i.e. calculated) by adding one to the number of self contained units provided to accommodate the registered person. (See paragraph 6 for a fuller explanation of how the new article will work in practice).
Listing Officers do not have discretion in determining how to operate the provisions of Article 3 as they do in relation to Article 4 of The Council Tax (Chargeable Dwellings) order 1992. (Aggregation of dwellings CTM:PN6).
In any instance where the property comprises more than one unit ''which has been constructed or adapted for use as separate living accommodation'' a separate band must be ascribed to each unit.
(NB a new Appendix 1 contains case summaries of all the leading cases)
Once it has been decided that there is a single hereditament a decision to disaggregate has to be made on the facts of each particular case. A house in multi occupation sharing a kitchen and bathroom may be a single dwelling if it is in the paramount occupation of the landlord, but each bed sit could be separate hereditament depending on the terms of occupation, in which case there is no need to go on to consider disaggregation. It will, however, be necessary to consider aggregation (see Practice Note 6) in such circumstances.
Where there is one hereditament but more than one self contained unit then the decision must be made on whether to disaggregate under articles 2 and 3/3A.
In deciding whether or not a ''self contained unit'' exists careful consideration must be given to the following:
''Constructed or adapted for use as separate living accommodation''.
Was the unit constructed or adapted for the purposes of use as separate living accommodation?
In Batty (LO) v Burfoot and Others, Batty (LO) v Merriman, Gilbert (LO) v Childs and Rodd (LO) v Ritchings 1995 RA 299, Counsel for the listing officers argued that the Valuation Tribunal had misdirected itself and derived from the degree of communal living the conclusion that the whole premises comprised a "single family unit of occupation". Ognall J accepted the submissions as well founded.
"In particular, it seems to me that to give account to the level of communal living is to introduce a consideration which is outwith the relevant criteria required in order to test properly the definition in question. It will be obvious that the purpose behind the great majority of these annexes is to furnish separate accommodation for an older generation in such a way as to allow of mutual privacy, whilst at the same time allowing for the degree of community which gives peace of mind to both parts of the family. It follows that in most cases the degree of communal living will be, or probably will be, significant. But that cannot assist, in my judgement, in answering the question as to whether the annexe in question was constructed or adapted for use as a separate dwelling".
It is considered that the words ''separate living accommodation'' do not mean merely living accommodation which is physically apart or distinct from other accommodation.
The meaning of “separate” was considered in the case of McColl v Subacchi (LO) 2001 RA 342. It was decided that there was nothing in the Chargeable Dwellings Order which compelled the conclusion that the fact that in order to gain access to the flat one had to pass through the house meant that the flat was not to be regarded as separate accommodation. Access was by a hall, stairs and landing shared by the owner of the house, and not through one of the main living rooms of another unit as in the Merriman case. The question of access, while a material factor, was not an essential condition of separateness for the purposes of council tax. The house was separate from the flat by virtue of the lockable door between the house and the flat, and nothing in the Order compelled the conclusion that the house ceased to be separate because the appellant had granted the tenants of the flat a licence to pass through her hall, stairs and landing in order to reach the flat.
The impracticalities of sale resulting from physical characteristics such as shared entrances and services go to valuation and not disaggregation. In Batty (LO) v Merriman the Judge said that if he were judging the merits of Mr Merriman's appeal on the particular facts he would have a deal of sympathy with the contentions which were directed to the physical character and layout of the annex, and in particular, to the means of access and egress (this was a case where access to the annex was through the lounge of the main house). In the circumstances of the Merriman case it is unlikely that there is more than one self contained unit as required by Article 3.
It is also significant that although the Judge was well aware of the means of access to the annex in the "Burfoot" case, he did not show the same sympathy in respect of this point as he did in the case where access to the annex was through the lounge of the main dwelling. There is therefore strong support for maintaining that access to the annex from the hallway of the main house would not prevent disaggregation.
Whilst the High Court Judge in the Batty cases refrained from deciding whether the phrase "has been constructed or adapted for use as separate living accommodation" should be construed objectively or subjectively, nevertheless the main thrust of his reasoning was that the question must be answered on the basis of a close examination of the physical character and layout of the premises - is the unit of accommodation physically capable of use as separate living accommodation?
The law was further clarified in the High Court case of Jorgensen v Gomperts 2006. This concerned a second floor flat in a large Victorian house in London N7, accessed via the front door, hall, stairs and landing of the main house. The ‘flat’ comprised a living/sleeping area, with a kitchenette and a bathroom, and was occupied by a lodger, who was free to use other parts of the house. The VT had decided to amalgamate the flat with the main house on the basis that:
At the High Court each of the above points was challenged and overturned. After referring to cases such as Coleman(LO) v Rotsztein 2003 and Clement (LO) v Bryant 2003 and others, Deputy Judge Kenneth Parker QC sets out in para. 15 of his decision in the clearest terms that the disaggregation test is a purely an objective ‘bricks and mortar’ test.
HMRCS recommends that from now on this passage should become the standard passage to which Listing Officers should refer at any VT hearing where disaggregation provisions are in issue.
After referring to cases such as, the Judge states:
“In my judgement, these passages from the foregoing authorities conclusively demonstrate that the test is an objective bricks and mortar test. Intention and use, actual or prospective are not relevant…”. He then adds some further reasons why a subjective test cannot be right. “… However, it seems to me….there are good policy reasons why an interpretation based on intention or purpose should not be adopted in this context. First, there may be real practical difficulties by reason of the passage of time or otherwise in ascertaining the intensions of an original constructor or later adaptor of the building. Secondly, a test based on intention might encourage taxpayers to devise strategies with varying degrees of ingenuity to persuade listing officers and/or the Tribunal that they had no deliberate aim to create separate living accommodation. Thirdly, administrative and judicial time would be employed in seeking to test the veracity of subjective claims or lack of the necessary subjective intention. This process would be costly and uncertain, with the probable result that success would depend more on the skill of the advocate than upon the intrinsic merits of the claim. Inequality of treatment would be likely to occur. I do not believe that such consequences would be in the public interest or accord with the object of Article 2 of the Order.”
In para. 20, the necessity to require the LO to present actual evidence of acts of construction or adaptation is robustly dismissed.
In para. 28 the “lockable door” issue is addressed. The Judge said:
“It is wrong in law to treat the presence of a lockable door as a necessary condition for the application of the order” and again “It is emphatically not a question whether any particular occupant might believe that privacy required a locked door, and without it there was no separate living accommodation. It is for the Tribunal, looking at the physical characteristics of the building, to determine on an objective basis whether those characteristics are sufficient to make part of the building separate living accommodation.”
In para. 29 in connection with taking into account the views of a previous LO, whilst allowing for a previous opinion sometimes to be admitted in evidence, the Judge stated
“In my judgement, it is for the Tribunal to decide whether on the facts of the given case the order applies” and “…at the end of the day, the judgement must be that of the Tribunal and the Tribunal alone”.
The decisions and judgements in the Batty appeals were approved by Sullivan J in Beasley (LO) v The National Council for YMCAs 2000 RA 429.
That case concerned 10 flats in a property known as Pinder House in Skipton North Yorkshire, which is owned by the National Council for YMCAs and is operated as a " foyer housing scheme" for homeless young people between the ages of 16 and 25. There was no dispute that the YMCA was in paramount occupation and that there was a single hereditament, but is was disputed that each of the flats was a separate self contained unit. Each of the flats comprises a bed-sitting room, with a kitchenette area and an en suite shower room with shower, wash hand basin and a lavatory. The kitchen areas are equipped with a sink, cooker and fridge and each flat has its own door lock. Communal facilities include two meeting rooms, laundry, disabled lavatory, bicycle store, refuse store and a kitchen. There is also a management office and a staff bedroom and lavatory which are separately rated. The building was purpose built in 1995.
In his decision Sullivan J accepted that there was a distinction on the facts from the Batty v Burfoot cases but considered that the underlying principle remains the same
"when looking at Articles 2 and 3 of the 1992 Order, one focuses not upon the use that is actually made of the building, but upon whether it has been constructed for use as separate living accommodation….. Whether Pinder House was controlled by one body, and whether that body had criteria for residency, had nothing to do with whether the flats had been constructed for use as separate living accommodation…… I would be prepared to accept that in deciding whether a particular flat has or has not been constructed for use as separate living accommodation within a larger building, it will often be relevant to consider the extent of the communal facilities which have been provided in the flat and the extent of the communal facilities which have been provided in the remainder of the building."
An analogy was drawn of traditional student accommodation in a student hostel where all that is available in a student's room is a bedroom, and all other facilities are provided communally, compared to a flat with all facilities en suite.
The occupier of a self-contained unit would usually expect it to have facilities for living, sleeping, preparation and cooking of food, and bathing facilities such as a bath, whb or shower room, and toilet.
The legislation does not provide that to be self contained a unit has to have all standard facilities and exceptionally there may be instances where the lack of a facility does not prevent a unit from being self contained. For example a unit purposely built and designed for occupation by an elderly person and which comprises a living room, bedroom, kitchen whb and WC may fall to be treated as being self contained despite the fact that bath/shower facilities are off a hall or landing and shared with others. (See Figure 1 of Appendix 2 ). This was confirmed in a decision of the High Court in Clement ( LO) v Bryant and others 2003 RA 133
The YMCA case makes it clear that actual use is not the determining factor, although it may be indicative of whether the building was constructed for use as separate living accommodation.
A self contained unit should normally have a single curtilage and not be spread over different parts of a building (ie. a living room with a kitchen and bathroom situated across a common hallway should not be treated as being self-contained).
If a unit is one which could be sold separately, either freehold or on a long lease, then this would point to it being self contained. However the fact that part of a property cannot be sold separately does not mean that it is not self-contained.
Whilst every case requires to be judged on its own merits the following observations are made in respect of the following groups of property.
A number of appeals concerning "granny annexes" were considered in the cases of Batty (LO) v Burfoot and Others, Batty (LO) v Merriman, Gilbert (LO) v Childs and Rodd (LO) v Ritchings 1995 RA 299.
In the case of Coleman ( LO) v Rotsztein 2003 RA 152 Sullivan J followed his decision in Beasley (LO) v YMCA and quashed the decision of the valuation tribunal not to separately band an annex constructed by the taxpayer as an extension to his family home for use of the family, because the taxpayer’s subjective intention in constructing the annex, and the use to which his family made of it, was not relevant to the question of whether it was a self contained unit, which depended on what had physically been constructed on the ground ( an objective or a “bricks and mortar” approach) .
Following the Batty cases Parliament created a new Class W to The Council Tax (Exempt Dwellings) Order 1992 which exempts a dwelling from Council Tax payment which is the sole or main residence of a dependent relative of a person resident in a dwelling within the same single property as that residence. No Council Tax will be payable if "granny" satisfies the age and dependent relative criteria set out by The Council Tax (Chargeable Dwellings, Exempt Dwellings & Discount Disregards) Amendment Order 1997 SI 656.
There will of course still be cases where the separate banding of an annex is disputed by the taxpayer, and Appendix 2 contains a number of examples for guidance.
By their very nature the majority of granny annexes usually comprise a part of a building which has been constructed or adapted for use as ''separate living accommodation''. The fact that access is shared with the main part and/or that services meters are situated in the main part will not necessarily prevent an annex from being self contained (see Appendix 2 example).
The fact that there is a legal restriction preventing a separate sale will not present the annex from being self contained, and having a separate Council Tax band ascribed to it (see Section 7 below), but it may have an effect on value of the annex.
From the 1990s onwards an increasing number of care homes for the elderly and disabled have been constructed to provide residents with sufficient facilities for independent living. Rooms will often contain a toilet and shower, facilities for the preparation and cooking of food, and space for a bed and day time activities. Residents will have access to communal facilities such as restaurant recreational areas, and in some cases the extent of these facilities for communal living will be extensive.
In the case of Williams ( LO) v Royal National Institute for the Blind and others 2003RA 158 the High Court considered the Valuation Tribunal’s decision not to disaggregate 4 flats occupied by elderly and blind or partially sighted residents of Kathleen Chambers House Burnham on Sea, a care home that is operated by the RNIB. Each unit was capable of accommodating two people and comprised in the case of two units a bedroom with en suite bathroom, a separate living room containing a work top and sink, two wall and base cupboards, a refrigerator, cooker or hob unit and separate oven. The other two units had two bedrooms and a shared bathroom, one of which had a separate kitchen area. The whole development contained 36 units of accommodation, but prior to the VT hearing the listing officer conceded that the small single rooms that contained the same kitchen, toilet and bathing facilities should not be disaggregated on the grounds of their size. The communal facilities were extensive and Counsel advised that the layout and design of the institution was such that general daily living requirements were met over the premises as a whole and not simply within the confines of the 32 individual smaller rooms. The rooms were so small that it would be difficult to entertain a guest or take meals within the room itself.
Mr Justice Mitting allowed the listing officers appeals and quashed the decision of the valuation tribunal, but was not persuaded by either interpretation of the definition of “ self contained unit” put forward by Counsel, preferring instead a middle course which allowed some account to be taken of the fact that this was clearly a building designed for the use of the blind. His Lordship accepted that the test was a purely objective “ bricks and mortar” test, but he also considered that when one came to consider part of a building which, judged by that objective test, was clearly a building for use of the blind and partially sighted people, then the test had to be modified so that one was not considering whether it could be used as separate living accommodation by an ordinary fit and able bodied person, but rather whether it could be used as separate living accommodation by blind and partially sighted persons. Because the VT had not made the necessary findings to enable him to answer this question for himself, the judge remitted the appeal back to the VT to reconsider its decision.
It is considered that following this case in deciding whether a unit of accommodation within a care home is self contained, in accordance with an objective physical test, the following indicators may apply. None of them are determinative in themselves:-
i) Is there a clearly defined kitchen area (eg in an alcove or a bay) in which a main meal can be prepared?
ii) Is there space for eating a main meal so prepared at a table?
iii) Is there space for personal furniture in addition to the basic requirements of a wardrobe, chest of drawers, bed and bedside table?
iv) Is there space where a guest can be seated?
v) Is there a bath or shower and toilet?
vi) Does the overall layout and design of the Institution indicate that the facility was constructed or adapted so that the general essentials of daily living were to be carried out by its residents in the private space or throughout the premises?
Following this decision Parliament amended articles 2 and 3 of the Council Tax (Chargeable Dwellings) Order to insert special provisions in relation to care homes (see para. 3 above).
With effect from 1 January 2004 in England (1 April 2005 in Wales) it is essential to examine care homes carefully, due to the provisions of Article 3a of the Order as follows:
a) Care homes that are registered under part 2 of the Care Standards Act 2000.
Counsel’s Opinion has been received on the application of article 3a, to the effect that its scope extends to all units within property registered as a care home under part 2 of the Care Standards Act 2000, and not just to where self contained units would otherwise have been disaggregated.
Thus irrespective of whether a care home owner is or is not in paramount occupation, the number of dwellings will be calculated in accordance with article 3a. If the registered person is in occupation of one unit then the total dwellings will be1+1=2. If the registered person occupies two units, then the total number of dwellings would be 2+1=3 and so forth. The larger ‘multiple’ dwelling will be banded according to its cumulative size and value. Effectively, disaggregation only applies to self contained units occupied by the registered care home owner. Staff rooms or units occupied by carers (as opposed to the registered person) as a part of their duties at the home will be included in the ‘multiple’ dwelling.
Only buildings included within the care home certificate will fall to be included, so it is crucial that the certificate is examined and it is established exactly what the care home comprises. Providing they do form part of the registered care home.
In all cases where it is claimed that the provisions of article 3a apply, a copy of the certificate of registration must be provided to the listing officer, before a decision is taken.
b) Care Home certificates and Domiciliary Care certificates
The Commission for Social Care Inspection (CSCI) are the Agency responsible for certification of care homes. They issue two types of certificate, firstly for care homes proper, and a second type for certification of the carer for domiciliary visits to people in there own homes. The question to be addressed is, what is the registered care home?
CEO has discussed this issue with the Commission for Social Care Inspection (CSCI) who are the body responsible for issuing certificates to Care Homes, under the Care Standards Act 2000. The Commission verify what a care home is, monitoring the whole care package provided by the carer, with specific reference to the accommodation in which care is provided and the standard to which it is delivered. Difficulty has arisen where the care provider displays certificates under the Care Standards Act for buildings which are not care homes as such, but where care is provided to people in their own accommodation, so called ‘domiciliary care’. These buildings may well be within the boundary of the overall site where care provision takes place.
Advice from CSCI indicates that buildings that are let out in separate flats, perhaps on shorthold tenancies, albeit provided by the care agency, may well have certificates for ‘domiciliary care’. They will not, however, be certificated as a Care Home. The certificates will not state number of occupants, and the Service Category on the certificate will state “Domiciliary Care Agency (DCA)”. These buildings are not regarded as care homes, but they are buildings regarded as people’s own homes, in which they receive domiciliary care. The CSCI draws a distinction between the ‘care home’ proper, where folk are in care, and where they receive care independently by carers visiting their own homes.
Interestingly, the dictionary definition of ‘domicile’ is ‘person’s regular place of abode’ and ‘domiciliary’ is a word used ‘especially of visit of medical consultant’. Thus in the context of disaggregation, where such sheltered units are visited externally by carers, visiting people in their own homes, these buildings are not Registered Care Homes. The DCA certificate will not mention the words ‘Care Home’ in the service category section, but will have ‘Domiciliary Care Agency’.
Thus great care must be taken to ensure that a building is a bona fide Care Home, has the appropriate certificate, and that the carer does not have a certificate only for domiciliary care.
Certificates are not complex documents, and consist of less than 2 sides of A4, but are required to be displayed on the premises at all times. To fall within article 3a provisions, the all important words “Care Home” must appear in the headings “Description of the Establishment/Agency” on page one, and under the heading ‘Service Category’ on page two. The certificate will also show the “Maximum Number of Registered” on page two. A DCA certificate will not show any registered number under this head. A typical care home certificate can be viewed here.
The CSCI website is a useful source of information concerning individual Care Homes, and details of certification and registered number of residents, will be found in the published care reports.
c) Care homes that are not registered under the 2000 Act
It must first be established whether there is just one hereditament, which might need to be treated as separate dwellings or whether individual dwellings exist on account of separate occupation. If the proprietor of the care home is in paramount control, and individual units exist, then normal principles of disaggregation will be applied as set out above.
In contrast to homes for the elderly and handicapped a modern private sheltered housing scheme clearly provides self contained units which are actively traded on the open market or let on a tenancy agreement notwithstanding the existence of some shared facilities such as a day room, a spare bedroom available for guests or the existence of a residential warden. Such units should be treated as separate dwellings, either each as a hereditament in its own right or by disaggregation. The value of the shared facilities should be reflected in the value of the individual units, to the extent that the market would do so. A degree of communal living within the hereditament will not prevent disaggregation. It is essential to first look at the terms of occupation of each unit before deciding whether each is a separate hereditament, and only if the landlord or owner of the building is in paramount occupation should the question of disaggregation be considered
Foyer housing schemes are an innovative development for homeless young people typically aged 16-25 years combining good quality accommodation with meaningful vocational training and further education. No formal qualifications are required in order for a young person to be offered accommodation in a Foyer; all that is required is a commitment on the part of the potential resident. Foyers offer a holistic approach to meeting the needs of disadvantaged young people by linking affordable hostel accommodation to training and employment.
By June 2001 there were almost 100 foyers across the UK, many run by the YMCA but others by Housing Associations and registered charities. All Foyers are owned, developed and managed by local partnerships, and the Foyer Federation represents the interests of Foyers at a national level. More information about Foyers can be obtained from the Foyer Federation web page at www.foyer.net
The buildings vary from purpose built accommodation of self contained flats to converted churches, warehouses and offices. Each scheme will have individual characteristics in terms of entry qualification, and the amount and nature of the accommodation. There will however normally be communal meeting rooms and laundry facilities for residents, and a mixture of office/training rooms. Some schemes will provide bed sitting rooms each equipped with an en suite shower room, toilet, and kitchen area with a sink, cooker and fridge. Other schemes will only provide bedrooms, without cooking facilities, and with communal showers and toilets. Meals are taken in a communal dining room/cafeteria.
A national trawl in 1998 has shown that a consistent approach for Council Tax banding has not been adopted, and therefore further guidance is given in this section.
The first step is to decide 'what is the hereditament?' The normal tests of rateable occupation will be applied, and therefore it is necessary to examine carefully the terms of the tenancy agreements or other written terms of occupancy to decide whether the resident of the room is in rateable occupation of that part of the building, or whether the provider of the accommodation is in paramount occupation of the whole building.
If the scheme provider is in paramount occupation the caseworker must then consider whether the disaggregation provisions of 1992 SI 549 should be applied. When deciding what is "separate living accommodation" an objective test requiring a close examination of the physical character and layout of the premises should be applied.
Limited facilities which may be enjoyed in an individual unit and the existence of communal areas are not proper reasons for deciding that disaggregation is inappropriate, and are contrary to the dicta of Ognall J in Batty v Burfoot HC 1995 RA 308 and the decision in Beasley (LO) v National Council of YMCAs 2000 RA 429.
Where however there are no self contained units of accommodation, but communal washing, eating and toilet facilities, clearly the property should be placed in a single band for Council Tax purposes.
There will be examples where the facts fit between these extremes, such as "clusters" of living accommodation, and any cases of doubt should be referred for advice to CEO Technical Centre, which holds a control list of such schemes across the country. It is anticipated that for most schemes it will be appropriate to disaggregate either by room or "cluster", but older hostels are unlikely to satisfy the tests set out in Article 3 of the 1992 Order. Disaggregation should not be rejected purely for the reason that the taxpayer has identified other very similar accommodation which has been placed in a single band. Other examples where disaggregation has been applied can be provided by CEO Technical Centre.
Cottages, annexes and flats constructed or adapted to accommodate staff will normally be self contained and should therefore be banded separately. Individual rooms within the main house will generally remain part of the house and their value included in the band of the main house.
When considering the extent to which a hall of residence or any part of it is self contained the test is not merely whether exceptionally it could be used as separate living accommodation but whether it was ''constructed or adapted'' for such use.
A stair or part of a hall might comprise the usual common room, study bedrooms, bathrooms, together with a kitchen but in practice, as intended in the designing of the hall, the kitchen may only be used for preparing coffee and snacks with the students generally dining together in a nearby refectory. In this circumstances the accommodation cannot be considered to be ''self contained'' because it was not constructed or adapted to be separate living accommodation from the refectory.
However a "stair" or part of a hall intended to be self catering and comprising the necessary facilities would fall to be disaggregated and banded separately.
It is likely that dining arrangements will be such that in the majority of instances several different buildings within the hereditament (dwelling) will require to be banded together.
CTM:PN 7 Appendix C and Appendix D gives examples of the treatment of Caravans and boats.
The disaggregation provisions do not apply to caravans and boats after 1 April 1997 (see 1997 SI No 656) but prior to that date if a caravan situated within the curtilage of the principal dwelling was occupied as separate and independent living accommodation then it would have a separate valuation band attached to it.
In the case of a caravan which is used for temporary independent living accommodation whilst the main dwelling is in course of renovation or is in the course of construction, it is important to consider whether the hereditament comprises the caravan and its pitch, rather than the curtilage of the whole plot, otherwise once the new dwelling is completed and capable of occupation it will not be possible to increase the band until a 'relevant transaction' has occurred.
Any units of accommodation within the larger dwelling which comprise several rooms and include a bathroom and cooking facilities should generally be treated as being self contained eg. a staff flat. Accommodation provided in a house or bungalow in the grounds of a hotel will normally be self contained even where, in practice, the staff take their meals in the hotel.
Staff accommodation which comprises part of a hotel and essentially provides a room for each member of staff will not normally be self contained. All of the non-self contained domestic accommodation should normally be treated as a single separate dwelling being the remainder of the domestic property, after all the self contained units have been separately banded.
Because the requirement to ''split'' the hereditament and attach a separate value to each self contained part did not exist for the purposes of domestic rating and there is often a legal restriction preventing the separate sale of any self contained part(s) the disaggregation provision often appears somewhat confusing to taxpayers. However, under Article 3 of the Council Tax (Chargeable Dwellings Order) 1992 the Listing Officer is under a duty to attach a separate band to each ''self contained unit'' and no legal restriction, either public or private, can serve to frustrate this statutory requirement.
The valuation of any disaggregated dwelling where all or part of the larger dwelling is subject to such a restriction is explained in section 9 below.
The basis of valuation of a dwelling which has been created as a result of disaggregation, where the value is dependent upon whether or not the original larger dwelling (hereditament) is a composite.
If the original dwelling (hereditament) is a composite hereditament, the value of each of the self contained units is arrived at by apportioning the amount which has been attributed to the domestic use of the composite (arrived at in accordance with regulation 7 of The Council Tax (Situation and Valuation of Dwellings) Regulations 1992 SI No 550 as amended).
Where the original dwelling is a composite regard can only be had to the demand from those persons who would have been in the market to buy the whole of the original dwelling (hereditament).
When attributing a value to any dwelling which has been created from a larger dwelling which is a composite hereditament, any restriction preventing separate occupation or sale will already have been reflected when arriving at the value of the domestic use and no further adjustment is appropriate, ie. such a restriction on sale/occupation is inherent in the basis of valuation of composite hereditaments.
(See CTM:PN 2 for more detailed instructions about the valuation of composite hereditaments).
If the original dwelling (hereditament) was itself wholly domestic property, each self contained unit, should be valued separately, in isolation and each in accordance with the principles and assumptions in Regulation 6 of The Council Tax (Situation & Valuation of Dwellings) Regulations 1992 SI No.550.
In contrast to the position which exists with dwellings which are composite it cannot be assumed that the different self contained parts were available for purchase at the same time. Regulation 6 does not require it to be assumed that all dwellings were available for sale at AVD, or more importantly, that neighbouring (ie. disaggregated) ones were on the market at this time. Accordingly regard should NOT be had to bids which would have been received from persons interested in purchasing the whole original dwelling (hereditament) with a view to occupying all relevant parts eg. a main house and granny annex together (unless very exceptionally the other part was actually on the market at AVD).
In contrast to the position which exists with composite hereditaments when considering the valuation which should attach to any dwelling which has arisen via disaggregation it is appropriate to have regard to the actual occupation of the remainder of the dwelling hereditament) as it actually existed as at AVD.
Usually a restriction preventing separate occupation/sale will not attach to the whole dwelling (hereditament). In the most common case of a house and granny annex, whilst it is usual for a planning condition to be attached which prevents the annex being used as an independent dwelling it is rare for the original house to be subject to any restriction.
The valuation of any annex created from a wholly domestic hereditament and which is subject to a restriction preventing separate occupation should reflect the fact that a prospective purchaser would know that such occupation would have been contrary to law. (It should be noted that a local planning authority would probably not be successful in preventing a separate sale, but such a sale would trigger occupation as separate dwelling, hence the two are linked)
What is required to be determined is the amount which a prospective purchaser would pay knowing that the annex was subject to a restriction. In every case regard must be had to the likelihood that the local planning authority (in the case of a planning restriction) or an individual or other body (in the case of a restrictive covenant) would take action and how a prospective purchaser would view the prospect of such action.
Where it is probable that a planning authority would take enforcement action subsequent to any sale of the annex the valuation must properly reflect this fact.
When valuing an annex it will often be appropriate to assume that the highest bid would come from that person who would be in a position to occupy it legally (ie. the owner of the main house).
It does not appear unreasonable to assume that the amount which the owner of the house would be required to pay would be somewhere between the ''restricted value'' and ''unrestricted value''. Given the small size of many annexes and their limited appeal to the open market a lower band may often be appropriate. A low band may not be appropriate in cases where, the ‘annexe’ may be substantial in area, attractive in design and quality and/or situated in a high value locality.
As indicated at section 8 above the value of any dwelling which has arisen through disaggregation of a non-composite dwelling (hereditament) must have regard to how the remainder of the original dwelling was actually occupied as at AVD. Whilst in the case of a house and granny annex this might lead one to conclude that only those persons actually in occupation of the house at the AVD would have been interested in purchasing the house (ie. because they were familiar with the occupant of the annex) it is important to note that any purchaser would have obtained the benefit of being able to bid for the annex and take legal occupation of it at some time in the future.
Accordingly in cases where there would have been a large difference between the ''market'' value of the adjoining annex and its value to the owner of the house (ie. due to enforcement procedures being rigorously applied) the value of the house at the AVD could well be ''underpinned'', helping offset any ''nuisance'' associated with the occupation of the annex.
A problem which can arise in practice is where an annex has been separately banded under the disaggregation provisions because a single property contains more than one self contained unit of accommodation, and the annex was occupied by an adult member of the family such as an elderly mother or father, who subsequently vacates to go into a nursing home, or is deceased. The family then reoccupies the annex as part of the main family home or the whole property is sold to a new taxpayer who does not wish to occupy the annex separately. Relief under 1997 SI 656 is withdrawn so that the taxpayer of the main dwelling seeks an alteration of the valuation list to delete the separately banded annex.
Because the annex is still capable of forming a self contained unit of accommodation it must still be separately banded, until such time as structural alterations are made to the property so that the annex is no longer self contained. This often causes difficulty; each case will depend on its own facts, and the degree of physical alteration/adaptation in question. It is likely that the removal of kitchen and bathroom fittings alone will not suffice without taking out the electrical/gas/water service pipes, since it would otherwise be a simple matter to reconnect.
Parliament intended that once part of a building has been adapted for use as separate living accommodation it should remain separately banded for Council Tax purposes if it remains self contained.
The effective date for disaggregation will be the date of the list alteration (not the date of the Notice of Alteration) by virtue of Regulation 14(7) of The Council Tax (Alteration of Lists and Appeals) Regulations 1993 SI No 290 as amended, where the alteration is to correct an inaccuracy in the list which arose in the course of making a previous list alteration. For new hereditaments the effective date is governed by regulation 14(1), and will be the day on which the circumstances giving rise to the list alteration occurred.
It is therefore very important when correcting a previous list alteration to distinguish whether a property should be banded as a separate dwelling because it comprises a separate hereditament (effective date will be the date of the compiled list or the date when the new hereditament came into existence if later) or because the disaggregation provisions of 1992 SI No 549 have been applied.