Two of our Huddersfield student HMOs had conditions imposed on the planning approval requiring the premises only be let to students. Students are exempt from council tax and if we are presented with a council tax bill (which happened recently) we pay the council tax and have it quickly refunded.
For now we are safe, however, in future we know we have to be very careful in the design and implementation of HMOs. Councils seem to have identified a cash cow in imposing a council tax banding on individual rooms, depending on the range of facilities offered to tenants. Yesterday I found this excellent guide on criteria published by Comfort Lettings, which I thought could be a valuable share.