§ Lord Houghton of Sowerby
asked Her Majesty's Government:
Whether they were forewarned by Inland Revenue of the action in the High Court to determine whether so called "granny flats" are to be included in the valuation for council tax or whether they are to be separately assessed for council tax; and what steps they now propose to take to reverse the present position.
§ The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Henley)
Officials of the Valuation Office Agency (VOA) briefed the Minister of State, Treasury, on this issue earlier in the year.
The Government will study the full text of the judgment as soon as it is available in order to decide what action may be necessary. Our current understanding is that it affects only a very small number of cases where there is an unresolved dispute as to whether a property contains one dwelling or more than one dwelling for council tax purposes. The ruling, as we 72WA understand it pending full examination of the transcript, does not mean that thousands of families caring for elderly relatives are likely to face additional back-dated council tax bills. The High Court has not said that either granny annexes generally or the particular granny annexes which were the subject of these cases are liable to separate council tax. It has merely said that the Valuation Tribunals concerned took irrelevant factors into account in taking their decisions. It has remitted the cases to the tribunals for reconsideration. The Government do not believe, and the judgment does not appear to suggest, that families should be financially penalised for sharing their home with an elderly relative or relatives.