Good morning

This note highlights an important but often overlooked consequence of the Renters’ Rights Act for council tax liability.  The RRA legislation primarily applies to England.

  1. Background

Currently, Council tax liability is determined by statute under the Local Government Finance Act 1992, not by the terms of a tenancy agreement. Liability depends on whether a tenant holds a “material interest” in a property (broadly, a lease granted for six months or more).

Historically, landlords granted fixed-term Assured Shorthold Tenancies (ASTs) of 6 or 12 months. In those cases, tenants could remain liable for council tax in certain circumstances even after vacating, because the tenancy had been granted for a term of six months or more.

  1. What has changed under the Renters’ Rights Act

From 1 May 2026, the Renters’ Rights Act:

  • Abolishes fixed-term ASTs in England
  • Replaces them with assured periodic tenancies from day one
  • Removes the ability to grant a tenancy for a fixed 6‑ or 12-month term

This change does not amend council tax legislation, but it has a significant practical effect on who pays council tax when a property is empty.

  1. Practical impact on council tax liability

Under the new system:

  • Assured periodic tenancies are not granted for six months or more
  • As a result, tenants do not acquire a material interest for council tax purposes
  • Tenants are liable for council tax only while they are resident
  • Once the tenant vacates, council tax liability passes immediately to the landlord

This applies even where:

  • The tenant gives notice but leaves before the notice period expires
  • The landlord is actively marketing the property
  • The tenancy agreement states that the tenant is responsible for council tax

Tenancy wording cannot override statutory council tax liability.

  1. What landlords should expect going forward

Landlords should now plan on the basis that:

  • Any void period following a tenant’s departure will normally be the landlord’s liability for council tax
  • This includes short gaps between old and new tenancies
  • Strategies previously used to keep council tax liability with tenants (e.g. long fixed terms or contractual periodic clauses) are no longer available
  • Council tax costs during voids should be factored into cash‑flow and pricing decisions.

Recommended landlord actions

5.  Landlords are advised to:

  • Budget for council tax during all void periods
  • Notify local authorities promptly when tenants vacate
  • Review cash‑flow assumptions where frequent turnover is expected
  • Take professional advice if operating mixed portfolios (long lets, short lets, HMOs).

Summary

6. While the Renters’ Rights Act does not change council tax law, it removes the ability to create a six-month “material interest” through fixed-term tenancies. As a result, landlords should now expect to be responsible for council tax whenever a property is unoccupied following a tenant’s departure.

If you require any advice on this, please email bill@ucadvice.co.uk

Regards

Bill Irvine

UC Advice & Advocacy Ltd