Council Tax

What is council tax?

Council tax is a local tax. It's set by local councils to pay for local services, such as police, fire, local council services, and so forth.

Why do I have to pay council tax?

Local council tax is a means of funding all the services that you use locally. Somebody's got to pay for them. The alternative would be to have them charged directly to you, which is hopelessly complicated. This is the way the local councils collect money to fund all of their activities for the year.

What does my council tax pay for?

Your council tax will pay for a whole range of local services, including an element of the police and fire. It's worth looking at the notes which come with the council tax demand, because exactly what they pay for depends on the area that you live in. It's very instructive to look at the way the tax is broken down, what you get for it, and how much of each pound you spend in council tax buys what, in terms of local services. Councils are very keen to tell their council taxpayers exactly what great value they're getting for their money.

How do I pay council tax?

Each year around the end of March, your local athority will send you the council tax demand, and that will be for a single sum that you can apply to pay yearly, an amount due in ten installments.

How much is council tax?

The amount of council tax and the rate at which the tax is paid, will be very locally. The amount is computed by reference to the value of our property. The value is given according to a banding system.

What are council tax bands?

Council tax bands are the valuation bands which houses are put into and which are used as a basis for calculating the local council tax liability. The bands in England have applied since 1993 and are based on valuations as of the first of April 1991. Therefore, by reference to current house prices, the values seem hopelessly out of date. Nevertheless, they are used as a starting point for the calculation. Band A covers properties then valued at up to 40,000 pounds. The banding system works through the alphabet up to band H, which covers properties then valued at 350,000 pounds or more.

Who decides which band my property falls into?

In England and Wales the evaluation of this agency decides on the band in which our property will sit.

Can I contest the amount of council tax I pay?

Yes, there are two things that are worth looking at when you're thinking about the amount you pay. Number one is whether your property is in the right band. If you think it's been put in the wrong band, then you should contact the local evaluation office and ask for the band to be reviewed. There's another very important thing which is that a number of very valuable discounts are available in respect to council tax. For example, if the property is occupied by only one person, then a discount of up to 25% is available. If you have a holiday home, then the holiday home may benefit from a council tax discount of between 10% and 50%. Finally, for people with low incomes and low capital, council tax may be available which will cover part or all of the council tax liability.

Are there any properties that are exempt from council tax?

A range of properties are exempt from council tax. For example if a property is empty and unoccupied, substantially unfurnished, then a 6 months exemption is available. A property is exempt if it's vacant because it needs major repairs before it can be lived in. It's exempt if it's condemned unfit for human habitation. It's exempt if it's been legally repossessed. Property occupied by students is also exempt if that's only occupied by students and nobody else. Properties are exempt if resident has had to move to a care home because they need care just to live their normal lives. Properties are also vacant if they're only occupied by people under the age of 18 years which is slightly different from the student exemption, also vacant if occupied only by people with severe mental impairment.

Is there any way I can pay less council tax?

There are some valuable reliefs and exemptions from council tax which are worth considering. For example, if the property is occupied by one adult only, then an exemption of 25% is available. If the property is a holiday home, then the holiday home may benefit from an exemption of between 10 and 50% of the amount of the council tax due. Finally, if the property is occupied by a person with low income and low capital, then council tax benefit may be available which will cover part or all of the council tax liability. It's also worth noticing in England that if the person is living in a self-contained granny flat with a relative, then the granny flat will be exempt from council tax.

How does council tax differ council by council?

There will be several differnces between Councils. House prices obviously vary considerably across the UK so properties will fall into different bands. That will affect the amout of tax payable. The rate of the tax will also vary somewhat between councils. So, people living in very similar houses within very different Council areas may find they pay quite different amounts of council tax. The other factor, of course, is the prospect that in England there will eventually be a reevaluation of properties for council tax purposes. That's been put off a couple of times now. But in England, people have noticed that when the Welsh property reevaluation took place a few years ago, the overall Council tax bill rose by about ten percent.

How does council tax differ throughout Great Britain?

Council tax in England and Wales is very similar, although in Wales the properties were revalued on a new bounding system introduced a few years ago. In Scotland, the system of local government finance is somewhat different.