Council Tax – Are You Paying Too Much?

Council Tax (CT) is a local tax on domestic property collected by local authorities. The amount of CT you are liable for depends on the ‘banding’ of the property you are living in, and other factors.

All homes are given a CT valuation band by the Valuation Office Agency (VOA). This band is based on the value of your home on 1 April 1991. A different amount of CT is charged on each band. If you disagree with this valuation you can challenge it. Talk to your local authority or local Citizens Advice about how to do this.

Beyond challenging this valuation, some properties are exempt from CT, some people are not liable for it and some people can get a discount. Below is a short guide to these liabilities, exemptions and discounts.

Properties which may be exempt include:

  • property which has been legally re-possessed by a mortgage lender
  • property unoccupied because the person who lived there now lives elsewhere because they need to be cared for
  • a holiday caravan or boat if it’s on a property where council tax is paid
  • a property where all the people who live in it are aged under 18
  • property which is occupied only by people with severe mental impairment
  • a self-contained ‘granny flat’ where the person who lives in it is a dependent relative of the owner of the main property

For a more comprehensive list of exempt properties contact your local authority or your local Citizens Advice.

Normally only one person, called the ‘liable person’, is liable to pay CT and the person living in the property will be the liable person. But sometimes it will be the owner of the property who will be liable to pay. If you are not sure who is liable for CT where you live contact your local Citizens Advice.

Not everyone has to pay the full amount of CT. There are three ways in which your CT bill may be reduced. These are:

  • a reduction scheme for disabled people
  • discounts
  • Council Tax Reduction and second adult rebate

A reduction scheme for disabled people

If there is someone (adult or child) living in a household who is substantially and permanently disabled, the CT bill for the property may be reduced. The reduction is made by charging CT on a lower valuation band than the one the property is in. Terms apply and it is important to check them before applying for this reduction.

Discounts

If only one (relevant) adult lives in a property, they will get a 25 per cent discount on the CT bill. When working out how many people live in a property, some people are not counted. These are called ‘disregarded people’. Get advice on who can be disregarded.

Other discounts may be available to those with:

  • empty properties
  • holiday or second homes, or
  • family annexes

Council Tax Reduction and Second Adult Rebate

A person who is liable to pay CT may be able to claim, depending on their circumstances:

  • a council tax reduction (formerly Council Tax Benefit)
  • a one-off discount of some or all arrears
  • second adult rebate

To see if you are eligible for any of these contact your local authority or visit your local Citizens Advice.

The information above is not exhaustive. The exact design and delivery of Council Tax where you live can vary depending on particular policies in your local area.

If you want to know more about what you are liable for, what discounts may be available to you, or how to challenge Council Tax decisions, visit www.citizensadvice.org.uk or get in touch with your local authority.

Our thanks to Coventry Citizens Advice (CCA) for submitting this article to us. For more information, contact your local CA offices or visit www.citizensadvice.org.uk.