Council tax on a granny annexe: where to check
Council tax is one of the running costs to think about before building a granny annexe. A self-contained annexe can be given its own band, and there are discounts and exemptions that may reduce or remove the bill, depending on who lives there and where in the UK you are. The Guide doesn’t give tax advice. This page sets out what to ask and where to find the official answer.
Illustrated from a scale model by The Garden Room & Annexe Guide.
Who to contact
- Banding (whether the annexe has its own band, and which one): the Valuation Office Agency in England and Wales, or the local Assessor in Scotland.
- Bills, discounts and exemptions: your local council.
The rules differ between the nations and they change, so check before you build and again before anyone moves in.
Will an annexe have its own council tax band?
It can. GOV.UK says that where a property is altered to create self-contained units, “for example an annexe”, each unit will have its own band. Whether that applies to yours, and which band it gets, is for the valuation office to decide.
- Check a band or ask about a change: Check your Council Tax band (GOV.UK) · Valuation Office Agency enquiries
- How bands work: How Council Tax works: working out your Council Tax (GOV.UK)
Discounts and exemptions to ask about
A separate band doesn’t necessarily mean a second full bill. These are the reliefs that come up most often for granny annexes. Whether any of them applies depends on who lives in the annexe and how it is used.
- England
- An exemption where the annexe is the home of a dependent relative of someone in the main house.
- A 50% reduction for some annexes used as part of the main home or lived in by a relative.
- An exemption for an empty annexe that can’t be let separately because of planning restrictions.
- Since April 2025 councils can charge a premium on second homes and long-term empty homes, with an exception where the property forms part of the same property as the main residence and is used as part of it. If the annexe will be empty or only used occasionally, ask your council whether that exception applies.
Read: Paying the right level of council tax: a plain English guide (GOV.UK), which has a section on annexes and is the clearest official summary. The legislation is listed under Official guidance below.
- Wales
The Welsh Government lists exemptions for an annexe occupied by a dependent relative and for an empty annexe that can’t be let separately. It doesn’t list England’s 50% annexe reduction, so ask your council what it offers.
Read: Council Tax discounts, disregards, exemptions and reductions (GOV.WALES)
- Scotland
Scotland has its own council tax system. Ask the local Assessor about banding, and your council about bills, discounts and exemptions.
Read: Council Tax discounts, exemptions and reductions (mygov.scot)
- Northern Ireland
Northern Ireland has domestic rates instead of council tax. See property rating (Department of Finance NI).
Questions to ask your council
Before you contact the council that collects your council tax (find your local council), have the details ready and ask directly:
- Will the annexe be banded separately from the main house?
- Who will live there, and how are they related to the person who pays council tax on the main house? Does that qualify for an exemption or a discount?
- What evidence do you need, and how do I apply?
- What happens if the annexe is empty for a while, or the person living there moves out?
- If the annexe is empty, does a planning condition that stops it being let separately make it exempt?
Keep a copy of the planning permission or Lawful Development Certificate. The empty-annexe exemption depends on whether planning rules stop the annexe being let on its own.
Official guidance
The sources this page is based on, all from government or legislation websites.
- GOV.UK: Paying the right level of council tax, a plain English guide (England, with sections on annexes)
- GOV.UK: How Council Tax works
- GOV.UK: Check your Council Tax band
- GOV.UK: Second homes and empty properties
- GOV.UK: Find your local council
- Valuation Office Agency: enquiries
- legislation.gov.uk: Council Tax (Reductions for Annexes) (England) Regulations 2013
- legislation.gov.uk: Council Tax (Exempt Dwellings) Order 1992, article 3
- GOV.WALES: Council Tax discounts, disregards, exemptions and reductions
- mygov.scot: Council Tax discounts, exemptions and reductions
- Department of Finance NI: property rating
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Frequently asked questions
- Do you pay council tax on a granny annexe?
- A self-contained granny annexe can be given its own council tax band, but discounts and exemptions may reduce or remove the bill. Which ones apply depends on who lives there and whether you are in England, Wales or Scotland. Your local council decides, so check with them before you build.
- Is there a council tax discount for a granny annexe?
- In England, there is a 50% reduction for some annexes used as part of the main home or lived in by a relative, and an exemption where a dependent relative lives there. Wales and Scotland have different rules. Ask your council which apply to you.
- Who decides the council tax band for an annexe?
- The Valuation Office Agency in England and Wales, and the local Assessor in Scotland. Your council then works out the bill and any discounts.
- Does an empty granny annexe pay council tax?
- An empty annexe that cannot be let separately from the main house may be exempt in England and Wales. Rules for empty properties vary, so check with your council.
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Last updated October 2026 · Part of our garden annexe guide.
