HMO deffinition

Tenancy Types and Management

I had a single guy in a 2 bed property who could not afford the rent due to changes to LHA rates, and he was under 35. He had his friend move in in February 2014 and they claimed single room LHA each. His friend moved out 2 weeks ago so I the original tenant informed the council he is again living alone, I did him a new tenancy, as luckily he has just turned 25.

Now I am in dispute with the council as the want £340 council tax off me, claiming 2 people with their own tenancies make a HMO.

I contend a HMO is 3 or more people as stated on GOV.UK, but they say their (notes) say if 2 people are there then its a HMO and I am liable for council tax.

Are they wrong or is it me?