I have a client who was in hospital long term, signed a tenancy and then moved into our property. HB turned down the claim on the grounds she did not occupy the property until she had been discharged from hospital. She has now received a council tax bill for the period between when she signed the tenancy and when she was discharged (at this time, a new application for HB and CTB was submitted which is being paid). This means that she loses both ways: between May and July she can't have HB because she did not occupy the property, but she is liable for CTax for the same 2 months.This seems an anomoly. any advice appreciated.

I have had a similar problem with Council Tax departments that do not understand the legislation.

The hiearchy of who is liable for Council Tax is given in the Local Government Finance Act 1992 The legislation clearly states that for a tenant to be a liable person, he has to be BOTH a tenant AND “resident”.

If the LA has made a decision that your clien is "not resident" then they clearly cannot enforce any CT liability.

Just a brief clarification....

"Residency" & "occupancy" are not the same. So, although it would be highly unusual, it's just conceivable that there may be CTAX liability, but no entitlement to CTB.

Regards

Sorry Kevin Do not follow that one.

In this case circumstance - how can someone begin a residency before moving in?

If there is no liability it is irrelevant what the CTB definition of occupancy is.

There is a Commissioners decision that may be of some help - he is saying that one does not have to physically have to move in for it to be treated as your residence if there are genuine reasons why you could not, in this case hospitalisation. However, it also depends on when her belongings were n moved in as he seems to use that when determining the actual date the occupancy started....

see CH/2957/2004

It is important to distinguish between CTB and CT liability. In this case the ideal result for the client would be HB &CTB from first claim. However if the LA sticks to its decision that the property was not occupied until later they cannot also say that the tenant was in residence from the start and there would in that case be no CT liability until moved in. CTB cannot arise until CT liability is established.

Don't forget Regulation 8(8) of the 2006 HB Regs - which in some cases allows for HB to be paid for up to 4 weeks prior to moving in if the claimant was in hospital when their liability started.

Derek:

I completely agree that there is no CTB if there is no liability and that there can be no liability without "residence" (distinguished from "occupancy").

The difference between "residency" (required for CTAX) and "occupancy" (required for CTB) is a question of degree. At the risk of over-simplification, residency is likely to be of a more casual nature. A person in "residence" for only part of the year may be liable for CTAX. But, that same "residence" could be insufficient to count as "occupancy" for CTB.

I'm not necessarily saying the LA has got it right in this case; just that it isn't inconceivable for there to be CTAX liability (residence), but nil CTB entitlement (due to non-occupancy).

Albeit in a slightly different context, this came up in R(H)4/05. NB: the law was quickly changed to nullify the effect of this CD.

I have an inkling that this has been looked at in another CD too; but I can't locate it at the moment.

Regards

Kevin, unless I have missed something I cannot find a reference to occupancy in CTB legislation?

My understanding is as follows.

Section 130 of the SSC&B Act 1992 defines eligibility for HB if one is liable to make payments in respect of a dwelling which s/he occupies as his/her home.

Section 131 defines eligibility for CTB where a person is liable for council tax in respect of a dwelling of which s/he is a resident.

The definition of resident in the Local Government Finance Act 1992 is - “resident", in relation to any dwelling, means an individual who has attained the age of 18 years and has his sole or main residence in the dwelling.

I agree with you that residency and occupancy is not necessarily the same thing. A person maybe classed as resident on day 1 but not in occupation until, say, day12. In that case CT liability begins on day 1 and so, therefore, does eligibility for CTB. HB eligibility starts from day 12 (or the following Monday where that provision applies).

Thus, CTB depends on residency. HB depends on occupancy. Or have I misunderstood?

The get out for getting HB to begin from day 1 is where a person can bring himself or herself within the ambit of the CD that Mike refers to.

Regards
Paul

This is not a direct comment on the case in question, but the issue of “occupancy” in CTB cases can come up.

Someone who is absent for more than 13 weeks can be not entitled to CTB, but still be considered as resident for CTAX purposes.

Hi Jim

I overlooked reg4C. I remember the case at the time and the amending legislation. Its easy how much you can forget Agree with you, but my point would still apply in temporary absence cases, wouldn't it?

Regards
Paul

"Thus, CTB depends on residency. HB depends on occupancy. Or have I misunderstood?"

Hmmm. With hindsight, I sould have been more careful with the terminology.

s.131 of the SSCBA 1992 and CTBR 8 (previously CTBR 4C) make very confusing reading. Instead of the word "occupy" (and it's derivatives), reference is made variously to "resident"; "absent" and "prescribed persons".

Working backwards, I don't think that there is much doubt that CTB absence, or residence, is to be equated to HB "occupancy" for temporary absence cases (i.e. the test(s) for CTB will be the same as for HB). Unless I'm misreading it, that view appears to be supported, albeit reluctantly, in Findlay (pg 629; 18th edition).

Now, to the issue of initial (i.e. first time) occupancy / residency...

s.131(1) & (3) states:

(1) A person is entitled to council tax benefit in respect of a particular day falling after 31st March 1993 if the following are fulfilled, namely, the condition set out in subsection (3) below and either -

(3) The main condition for the purposes of subsection (1) above is that the person concerned-

(a) is for the day liable to pay council tax in respect of a dwelling of which he is a resident; and
(b) is not a prescribed person or a person of a prescribed class.


CTBR 8(1) states:

(1) Subject to paragraph (2), a person who is throughout any day referred to in section 131(3)(a) of the Act absent from the dwelling referred to in that section, shall be a prescribed person for the purposes of section 131(3)(b) of the Act in relation to that day.


In my view, the above has the clear effect of distinguishing someone who is liable and resident from someone who is absent (having been deemed a "prescribed person" through CTBR 8); while not treating the two as being mutually exclusive.


If being "resident" was the sole criteria for CTB, R(H) 4/05 would still hold. But, as mentioned above, the Act and the regs were changed from April 2005 in direct response to the CD. The intention was to bring CTB into line with HB in terms of "occupancy" being (more or less) equated to "residency" for benefit purposes. As to whether that intention has been achieved may yet be arguable - once again see the CPAG analysis on pg 629.

Regards

But a person is not a prescibed person if they are temporarily absent under sub-para 2 (my reference, above, to the old reg 4C is to the now reg 8).

So residency and occupancy in these case are not co-terminous. Or am I having a brain meltdown?

It seems I am having a brain meltdown. Because of the amendment to reg 4C (now reg 8) following R(H)9/05) then if the person can take advantage of reg 8(2) then reg 7(16) of the HB Regs would also apply thus residency and occupation would have the same practical effect. So if CTB was paid then so would HB.

Its going to be one of those days!! Lol!

My head is spinning!

Yeah but, no but.... compooter says noooo...

To my mind, the key phrase in HBR 8(2) is "period of temporary absence" which is then defined in HBR 8(3).

HBR 8(2) interacts with HBR 8(3). My (ever more tentative!) reading is that the "prescribed person" provision has to be disapplied, otherwise the temporary absence rules under HBR 8(3) could never have effect. The disapplication only applies for the purposes of temporary absence.

Off for a coffee......