Gillespie Gifford & Brown

Alterations to property give rise to Council Tax increase for new owners...


Property Alterations give rise to Council Tax increase - for new owners!
Most people don’t know that Regional Assessors monitor the Building Control Register. They do that to find out what alterations requiring a Building Warrant have been carried out to which property. They will then decide whether the alterations give rise to an increase in the value of the property which, in turn, causes an increase in Council Tax when it’s sold.
Regional Assessors in Scotland have the responsibility to set and manage Council Tax banding on behalf of Scotland’s local authorities. This includes a statutory duty to maintain The Council Tax Valuation List.
This power to reassess the Council Tax Banding is contained in The Council Tax (Alteration of Lists and Appeals) (Scotland) Regulations 1993. Regulation, 4(1)(a)(i) states: “no alteration of a band shall be made unless there has been a material increase in the value of the dwelling and it has subsequently been sold”.
If the Assessor decides that there has been an alteration that gives rise to an increase in the Council Tax Banding, Regulation 19(1) will be invoked. Regulation 19(1) determines what the “effective date” will be- in other words, when the increase will take effect. It says: “any alteration of the list effected so as to reflect a material increase in the value of a dwelling shall have effect from the day on which the first sale of the dwelling was completed”.
The alterations have no impact on the Council Tax position for the present owners who carry out the alterations and the re-banding only comes into play when the property is sold.

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