When property guardians take up residence in a vacant property, the use of the building makes a temporary, informal switch to ‘residential’. This normally means that the vacant commercial property is taken off the rating list by the valuation office, meaning it no longer has to pay business rates.

Instead, as the property is now used for lived accommodation, it becomes liable for council tax. Often far cheaper than business rates, the cost of paying council tax bills normally forms part of the property guardian’s responsibility.

In Summary: Vacant properties protected with the property guardian scheme normally pay council tax instead of business rates. The council tax payment is often made by the guardians residing in the property alongside other bills, utilities, and a small license fee. Helping the property owner make valuable savings while the property is vacant.

Changing Circumstances?

Every property is different and, occasionally, there is some ambiguity over whether council tax or business rates should apply to a property guardian protected property. Local councils judge each property on a case-by-case basis, meaning that in rare cases some vacant properties protected by guardians may still have to pay business rates instead of council tax.

A case in 2019 saw a disagreement arise between a property owner and the local council. The local council deemed the property as ‘essentially vacant’, regardless of the property guardian’s residing in the building. This was because the guardians occupied as licensee’s, not as tenants (standard practice for property guardians). This decision was appealed, and upon further review, the local authority changed their decision and agreed that as the properties main use was for accommodation, council tax would apply instead of business rates.

However, a more recent case in 2021, had a different outcome. Although both cases had similar circumstances, the local authority ruled the property guardians were not liable to pay council tax and the owner retained the responsibility of paying business rates on the ‘vacant’ property. This decision was made mostly because the guardians only occupied a small amount of the very large property.

What Does This Mean for Property Guardians and Council Tax?

It is more common that property guardian protected properties will pay council tax rather than business rates.

But, just to be on the safe side, here at Blue Door Property Guardians we have a specialist team on hand to help get the best deal for our property owners depending on the unique circumstances of their building. As councils make their judgement on a case-by-case basis, we treat each property and case differently, to make sure that our clients’ outgoings are as minimal as possible – without sacrificing the quality of our service.

Click here to find out more about our zero-cost property guardian protection scheme.

Related Questions:

Are Property Guardians the Same as Tenants?

Although the presence of guardians helps landlords to mitigate the cost of business rates by using their building for accommodation purposes, property guardians do not count as tenants.

Instead, they are considered licensees granted permission to live onsite within their duty to protect a property. This allows property guardian contracts to be far more flexible, meaning the landlord and property owner can enjoy benefits such as 30-day hand back and access to the property at any time.

You can read more about the difference between guardians and tenants here.

Do Landlords Have to Register a Change of Use for Property Guardians?

No, landlords do not have to register a change of use for the property when they use property guardians to protect their vacant building.

This is because the buildings primary use remains the same. Any guardian residence is put in place with the intention of protecting and maintaining the property for a temporary duration of time while the landlord finds the next use for the building. The only time you would need to register a change of use for a property, is if the properties’ main purpose is changing permanently.

What About Residential Properties and Second Homes?

If you own a vacant residential property, e.g. a second home or holiday rental, you will be required by your local council to pay tax on the building. This is normally double the standard rate in the UK for homes that have been vacant for 2 years or more.

However, when you use property guardians to protect the vacant property, the duty of paying the council tax will be part of the property guardians’ contract. Helping you, the landlord, to save money and reduce your outgoings while your residential property is vacant and generating no income.

Are Property Guardians a Good Choice for Landlords?

Property guardians are a great choice for landlords looking for an affordable way to maintain and secure their vacant property.

By placing the needs of the community and the landlord side by side, the property guardian scheme takes a rounded approach to maintaining the safety and value of vacant properties.

With guardians living onsite 24/7, landlords can rest easy knowing that their property is protected and secured. Instead of sitting empty and becoming a drain on resources, the vacant property is used to provide affordable housing that boosts local economies.

Plus, the scheme is far cheaper than traditional security methods and helps the landlords to reduce costs such as council tax, business rates, or vacant property insurance - all while securing the value of the asset.

At Blue Door Property Guardians, we offer our service at zero cost to the landlord. We also offer additional perks such as 30-day guaranteed hand-back and customisable contracts as standard. Our priority is to support the community, protect the value of your asset, and minimise your outgoing costs.

If you’d like to know more, you can drop us an email or give us a call to speak to one of our Blue Door advisors who will be happy to answer any questions you might have.