Council tax is a domestic property tax which is collected by local authorities in order to fund the provision of services like rubbish collection. The amount that you pay depends on factors such as the size of your home, the number of permanent residents and the area where you live. It has to be paid whether you rent or have bought your home. In this article we examine:
- Discounts on Council Tax
- Exemptions from Council Tax
- Consequences of non payment
Are there any discounts on council tax?
Although it is compulsory for all permanent UK adults to pay Council Tax, there are a number of discounts. The most common is a discount for single occupancy. If you are the only adult occupant of your home, you are entitled to a 25% discount on the amount you owe irrespective of how much you earn.
Recipients of some state benefits such as Universal Credit or state pensions might also be entitled to a reduction on their Council Tax. This help (also called Council Tax Support) varies depending where you live. The size of the discount is calculated according to factors such as:
- which state benefits you receive
- your age
- the size of your income and savings (if any)
- who lives in the home
- the size of your tax bill
You might also be entitled to a discount (of up to 50%) if you own a second home, or if your property is uninhabited. This depends on your local authority.
Council tax questions
There are certain cases for Council Tax support, which is also known as Council Tax reduction. The criteria for a Council Tax reduction varies but generally depends on whether you are on a low income or on benefit support. To find out more about potential Council Tax support that you may be entitled to, contact your local authorities for inquiries.
To be qualified for a Council Tax reduction, you must be on low income, no income, or on benefit support and have savings lower than £16,000. You may apply regardless of whether you rent or own your home, but you must be a resident of the stated address and it should be your main place of residence.
If you are a recipient of benefits in the form of Universal Credit, you may be entitled to pay less in Council Tax. This is largely dependent on your circumstances and where you reside. For applications related to reduced Council Tax, you do not necessarily have to wait until approved for Universal Credit or for the first payment to have been deposited to your account.
Who is exempt from paying Council Tax?
Full-time students don’t have to pay Council Tax even if they’re over 18, but only as long as their course lasts at least a year and involves at least 12 hours’ of studying per week. Similarly, those on training schemes such as apprentices might also be exempt from paying Council Tax as long as they fulfill certain criteria.
People who work as live-in carers for people to whom they aren’t related don’t have to pay the tax either.
What happens if you don’t pay Council Tax?
Council Tax is considered a priority bill. This means that if you don’t pay your installment on time and/or you fall in arrears, there can be quite serious consequences for you. The measures that councils can take include having a magistrate issue a liability order to demand payment. In this case, you will also be liable for paying all legal fees. If the tax remains unpaid, then the arrears could be taken directly from your wages and/or state benefits. In extreme cases, they could send in bailiffs to seize property, and you might even face a prison sentence of up to 3 months if it’s decided that you could have afforded to pay the Council Tax.
For these reasons, it is very important that you contact the Housing Services of your local authority as soon as you realise that you will have problems paying. In such circumstances, councils usually agree to reach a compromise with you and will make arrangements for you to make smaller payments until the arrears are paid off.