Council Tax Enquiry

[JBW1366]

Hi

This is an ongoing saga with relation to my sale of my maisonette, I am currently band C, but my buyers solicitor reckons I should be in a higher band rate D because of alterations I have made, my solicitor has arranged for me to get indemnity insurance but he wants me to check if I need to pay more council tax, surely this is covered in the indemnity insurance?

We had a two bedroom maisonette, the second bedroom was big, length 5.11 metres long, 2.9 metres wide with a big window and radiator each end. In the middle was a square walk-in closet with door which practically divided the room in two, and the door into the room opposite, and we used the walk in closet as wardrobe toy closet. My kids a girl and a boy, had one half each either side of the closet.

As they got to teenagers, they needed privacy, so we dismantled the door side and one side of the closet, and created two doors ways into now two separate rooms, nothing else was touched all we did was dismantled a stud wall, and put up a small stud wall, and the two door way and doors, and each room measures, 2.8 metres by 2.9 metres and the other is 2.3 metres by 2.9 metres the difference in sizes is due to the location of the original closet wall, which we still used, the new stud wall can be easily dismantled and put back to one room.

Would this alteration alter the council tax band? We can’t ask as that would make the indemnity insurance useless.

Any help greatly welcomed, as this is stalling our sale and subsequent move.

[bednobs]

Are u selling it as a 2 or 3 bedroom?

[JBW1366]

Is that our mistake? We are selling as a three bedroom

[bednobs]

Then u will need to do as you were advised in a previous post re getting a new council tax valuation. You can't say that it was nothing but then also say you now have a 3 bedrooms house if you get what I mean. You have clearly made a material change.

[Buenchico]

Haven't we been here before?

If your property is in Band C it means that the VOA is of the opinion that, had it been offered on the open market in 1991, it would have been worth between £52,001 and £68,000. To qualify as Band D it would have had to have been worth between £68,001 and £88,000.

Our problem here is that we don't know exactlywhat (nominal) 1991 value the VOA has applied to your property. If, say, it was £52,100 then simply dividing a bedroom wouldn't push the value up to above £68,000. (i.e. the band would remain unchanged).

However if the VOA thought that your maisonette would have been worth £67,900 in 1991, then dividing the bedroom might well be enough to push that value up to over £68,000, thus triggering a change in the band.

As I suggested before, you should contact the VOA to ask them to re-assess your property. (Even though they'd be doing it in 2018 they still have to use 1991 prices). Then, if they tell you in writing that it's still in Band C, you won't need indemnity insurance (at least in respect of the Council Tax band) anyway.

[bednobs]

By the way these sorts of things happen all the time. Don't lose heart!

[JBW1366]

So, does indemnity insurance cover this type of problem? As the indemnity insurance is for situations like this in case a claim is needed in the future

[Buenchico]

I can't see indemnity insurance being particularly relevant to Council Tax anyway.

If you've still not sorted out the issues of the leaseholder's permission and building regulations though, indemnity insurance would give you protection if the person who'd purchased your property was later ordered to rip the wall down (or make alterations to make it acceptable) and then sought to claim compensation from you.

[Buenchico]

^^^ Erratum!

"leasholder's permission", above, should of course read "freeholder's permission"

[bednobs]

i also cant quite see how indemnity insurance relates to this - you would be asking someone to indemnify the purchaser against future council tax bills being higher than they originally thought? How would that be possible? how No indemnity would cover the sort of open-ended ongoing payment you are asking them to