Can I get a council tax reduction?

Are you entitled to a council tax reduction or discount that can slash what you pay? And should you challenge your council tax band to lower your bill? We take a look

Rebecca Gamble Consumer Journalist

We’re all looking at ways to cut costs so it’s important to find out if you’re entitled to a council tax reduction or discount which could save you hundreds of pounds a year. And in some cases you won’t need to pay any council tax. And you may also be able to save on your council tax bill if your home is currently in the wrong council tax band. We explain what you can do about it.

What is council tax?

Council Tax is a compulsory tax charged by your local council to fund local services such as rubbish collection. It is an annual charge, usually spread over 10 monthly payments. If you pay your council tax in 10 instalments, you will be granted a tax-break in your bill usually in February and March. A full Council Tax bill is based on at least 2 adults living in a home.

Depending on your circumstances you may be able to get:

• A council tax discount – such as for a single person or an empty property
• Council Tax Reduction – for example if you’re on a low income
• A different reduction if you can’t get much Council Tax Reduction

How to avoid paying council tax: Who is exempt?

When calculating how many people are in the property, some people aren’t counted – this is known as disregarded.

You’re disregarded if you’re:

• A young person living at home: This includes those under 18 years old or 18 or 19 years old and in full-time education.
• In education or training: This includes if you’re enrolled on certain apprentice schemes, a full-time university student, a young person on a government training scheme, a student nurse, a foreign language assistant registered with the British Council
• Temporarily away from home, such as a long-term hospital patient or care home resident.
• Have learning difficulties or severe mental impairment and receive certain benefits
• If you host people under the ‘Homes for Ukraine’ scheme, they’re disregarded for council tax.
• Some other people may also be disregarded, such as some live-in care workers. Contact your local council to find out.

Which properties are exempt from council tax? 

Some properties are exempt from council tax. These include:

• Armed forces accommodation
• Annexes which are occupied by the owner’s children
• Homes which are solely occupied by full­ time students
• An empty home can be exempt from council tax for up to six months if it is left unfurnished
• If you are conducting major structural changes to your home your council may offer an exemption
• You are exempt from council tax for 6 months on homes which were owned by someone who has died. This exemption begins after probate is granted

If your home is empty for one of the following reasons it is exempt as long as it remains unoccupied: if you’re in prison, your home has been repossessed, your home cannot be lived in by law, you’ve been taking into care or hospital, your home has been bought by compulsory order.

Click here to apply for council tax exemption

How to check if you can get a discount on your council tax

Your first step is to check if you’re already getting a council tax discount. Check your bill or contact your local council. If you’re not already getting a discount you may still be entitled to one. Read on to find out what you may be entitled to.

Single person council tax reduction – how to apply

If you either live on your own or everyone else in your home is disregarded you can apply for a single person council tax reduction of 25%. While if everyone in your household is disregarded you’ll get a 50% discount off your bills.

If you’re not sure whether you can get a single person council tax reduction or who is responsible for paying, contact your local council.

However, when you’re looking at ways to cut bills, don’t forget to check if you can save on what is likely to be your biggest monthly bill – your mortgage – by remortgaging onto a cheaper deal. The easiest and quickest way to do this is by speaking to a fee-free mortgage broker.

Council tax discount on second homes or holiday homes

Some councils offer a ‘second home discount’ because no one lives there permanently; for more information, read our guide on Second home council tax explained.

Council Tax Reductions explained

You could be eligible for a Council Tax Reduction, sometimes called Council Tax Support, if you’re on a low income, you have disabilities or claim benefits. Your bill could be reduced by up to 100%.

But any council tax reduction you get depends on a number of factors:

• Where you live – each council runs its own scheme
• Your circumstances (such as what benefits you receive)
• Your household income – this includes savings, pensions and your partner’s income
• Whether your children live with you
• If other adults live with you

So for example, if you’re asking ‘do you have to pay council tax if you’re on benefits?’ the answer is, it depends. Also, you can apply whether you own your home or you rent, or you’re unemployed or are working.

Contact your local council to check if you are eligible

How to apply for a council tax reduction

When it comes to how to apply for a council tax reduction, you’ll need to apply to your local council. This is usually done by completing a form or applying online however some councils may let you apply by telephone. If you live with a partner, only one of you needs to apply and you’ll get a discount on your bill if you’re eligible.

When should I apply for council tax reduction?

If you’re eligible for a council tax reduction, apply as soon as you can. And you can apply early if you know you’re going to be eligible; you can apply for it up to 8 weeks before you become responsible for paying council tax, such as if you’re moving into a new home. By applying early, in theory you’ll have less time to wait to get council tax reduction when you become eligible.

While if you’re already paying council tax, you can apply for council tax reduction up to 13 weeks before you’ll become eligible for it, for example if you have found out you’re being made redundant.

If you’re already eligible for council tax reduction when you apply you might be able to get it backdated, contact your local council about this if this applies to you.

What evidence will I need to show to get a council tax reduction?

Details of what evidence you’ll need to send should be on your council’s website, for example you might need to send evidence of your savings and income.

What if I disagree with my council’s decision on CTR?

You should write to your council as soon as possible, explaining why you disagree and ask them to reconsider. Your council should say on its website how long you have to challenge its decision. Your council should write to you within two months outlining if they have changed their decision and why. And if you still don’t agree you may be able to appeal to the Valuation Tribunal.

Council tax reduction for pensioners: What are the rules?

With council tax reduction for pensioners, how it’s worked out will depend whether you fall under ‘working age rules’ or ‘pension age rules’. If you’re under the State Pension age, the working age rules apply. However, working age rules still apply if you’ve reached State Pension age and you or your partner get Universal Credit, income-based Jobseeker’s Allowance (JSA), income-related Employment and Support Allowance (ESA) or Income Support.

However, if you’re reached State Pension age and don’t receive any of these benefits, pension age rules apply.

The pension age CTR rules are usually more generous than the working age CTR rules.

Considering equity release? Try Key Advice’s equity release calculator today to find out how much you could release

What is Second Adult Rebate?

Second Adult Rebate, also known as ‘Alternative maximum Council Tax Support/Reduction’, can reduce your council tax bill if you’re the only person in your home liable to pay council tax but you have another adult living in your home who:

• is over 18
• isn’t your partner
• isn’t jointly liable for council tax
• doesn’t pay rent to you
• is on a low income/certain benefits

While Council Tax Reduction is based on your income and capital (such as your savings), Second Adult Rebate is based on the income of the adult living with you. So you may be entitled to Second Adult Rebate even if you’re not entitled to Council Tax Reduction. However, if you’re entitled to both, you’ll be awarded the higher of the two.

Council tax hardship relief

If you’re suffering exception hardship for reasons out of your control like losing your job you may qualify for hardship relief; this will reduce your council tax bill temporarily. To qualify you may need to show evidence like having no savings and your income being less than your outgoings. Contact your local council to find out if you’re eligible; any discount will be given at its discretion.

And if you are struggling to pay your council tax, speak to your local council; you may for example be able to spread the payments across 12, rather than the usual 10 months.

If you’re worried about your energy bills, you’ll want to know what energy bills help is available. Read our Energy bills help guide to find out.

What disabilities qualify for council tax reduction?

If you or someone you live with is disabled you might be able to apply for a council tax discount or exemption.

Disabled Band Reduction Scheme

You may be eligible for the Disabled Band Reduction scheme if you live in a bigger property than you’d need if you or someone else living there wasn’t disabled. To qualify, the property must be the main home of at least 1 disabled adult or child.

And if you qualify, your council tax bill will be reduced to the next council tax band down. So if your home is in council tax band E, you’ll pay the council tax band D rate. While if your property is already in the lowest band of A, you’ll get a 17% discount on your council tax bill.

To qualify for the Disabled Band Reduction scheme you’ll have to show that you have either:

• an extra bathroom, kitchen or other room that you need for the disabled person
• extra space inside the property for using a wheelchair

To find out if you qualify, contact your local council. Some local councils ask for extra evidence – for example, a doctor’s letter.

Discounts for severely mentally impaired people

You may able to apply for a council tax reduction if you or someone you live with is severely mentally impaired.

• You’ll get a 100% discount if you qualify as severely mentally impaired and you live alone or any other adults in your home either qualify as severely mentally impaired or are full-time students.
• While you’ll get a 50% discount on your council tax bill if everyone else in the house is ‘disregarded’
• If you live with someone who’s severely mentally impaired, you’ll receive a 25% discount if there are no other adults in your household or everyone else in your home is disregarded.

What to do if you think your council bill is wrong

If your bill doesn’t reflect a discount you were expecting, contact your council as soon as possible. But it’s also important to tell your council if you have mistakenly received a discount. Otherwise, you could be fined.

Is there a council tax reduction calculator I can use?

No. Unfortunately there isn’t a council tax reduction calculator to use as each council may have different rules on council tax reduction.

Council tax reduction: How do I challenge my council tax band?

The amount of council tax you pay depends on what council tax band you’re in – so if you think your home is in the wrong band, if you successfully challenge it your bills will drop. But don’t do this lightly as if you get it wrong, your property’s band – and the amount you pay – could increase. Here’s what to do if you want to challenge your council tax band.

Firstly, you’ll want to establish is whether you have a case for challenging your council tax band. The first step in assessing this is to find out what your neighbours pay. You can ask them if you have a good relationship, or look online.

For homes in England and Wales you can search by postcode on the Valuation Office Agency website and it will list the council tax bands for properties. For homes in Scotland, you can search on the Scottish Assessors website.

If your neighbours in similar homes are in a lower band than you, you might have a claim. However, it is possible they’re in the wrong band – so the next step is essential to avoid the risk of them being moved into a higher band if you challenge yours.

• Conduct a valuation: You need to find out how much your house was worth in 1991. This is because that’s when council tax bands were last set. Try using Monysavingexpert’s calculator which uses Nationwide data to estimate what your home’s value was in 1991. And very usefully, also shows you the council tax band relating to that price.
• Beware bills could go up: So it’s essential to do your research and think carefully before challenging, in particular considering factors like if you have extended your property or added more bedrooms.
• Steps to challenge your council tax band: If you’re convinced your property is in the wrong band then in England and Wales, you need to contact the VOA. You can call them on 03000 501 501 for properties in England and 03000 505 505 for homes in Wales. They may review and change your band without you needing to challenge it. While in Scotland, you’ll need to start with the SAA website, input your details, choose to ‘make a proposal’ and they will contact you.

Frequently Asked Questions