What is Council Tax Reduction?
Council Tax Reduction is a local scheme to help people on a low income, in or out of work, or in receipt of state benefits. The amount you can receive depends on your income and circumstances and is shown as a discount on your Council Tax rather than being paid as a benefit.
Pension Credit age people
For applicants of pension credit age, the Government has set the rules we must use to calculate Council Tax Reduction.
Working age people
For applicants of working age, the current local scheme adopted by this Council is an income banded scheme. The basics of the scheme for working age people are:
- The reduction is based on the net income of the applicant, and their partner if they have one
- The maximum discount that can be paid is 80%. Therefore, people liable for council tax must pay at least 20%
- Anyone with savings above £6,000 will not qualify
- Applicants will receive a discount of 80%, 60%, 40%, 20% or no discount, depending on the level of their income and the income band they fall into
- Those receiving a passported benefit – ie: Income Support, Jobseeker’s Allowance (income-based) or Employment and Support Allowance (income-related) will automatically receive the maximum discount
- Examples of income are earnings, self-employed earnings, tax credits, pensions, student grants/loans, Jobseeker’s Allowance (contributions), Employment and Support Allowance (contributions), Universal Credit
- Net weekly income will be taken into account when calculating Council Tax Reduction
- Net income means once income tax, national insurance and half of any personal pension is deducted from a person’s earnings
- To support incentives to work for customers not in receipt of Universal Credit, £25 per week will be disregarded from the applicant’s net earnings and only one disregard shall be applied per claim
- Income from Carer’s Allowance, Disability Living Allowance, Personal Independence Payment, Armed Forces Independence Payment, Child Benefit, Child Maintenance, and War Disablement Benefits will continue to be disregarded when calculating Council Tax Reduction
- Extra amounts may be disregarded from your income if someone in your family is disabled e.g. if your child receives Personal Independence Payment this amount will be disregarded from your income
Full details of the scheme are available below.
Details of previous year Council Tax Reduction Schemes