Local Council Tax Support Scheme

The issues regarding households that receive Disability Living Allowance or Personal Independence Payments and have adult children residing in the property have now been resolved. If affected you will have received Council Tax Reduction notification letters and a new Council Tax bill showing the new amount to pay. In addition, if you have lost more than £5.00 per week compared to your 2021/22 Council Tax Reduction entitlement, then you will automatically receive some additional assistance in the form Transitional Protection applied to your Council Tax account. Please note that Transitional Protection will only be applied against the 2022/23 liability. For the 2023/24 financial year there will be no assistance in respect of Transitional Protection. If you are having difficulty paying your Council Tax then please use the link for the Council Tax Reduction hardship fund at the bottom of this page.

Changes to the Council Tax Reduction scheme from 01 April 2022

From 01 April 2022 the Council Tax Reduction scheme for working age people will change to an income banded scheme. Pension age residents will not be affected by these changes.
 

Do you need to re-apply for Council Tax Reduction?

No. If you are currently in receipt of Council Tax Reduction your entitlement will be automatically re-calculated on 01 April 2022 based on the new Council Tax Reduction income banded scheme. You will be notified of the changes to your entitlement in your annual Council Tax bill/reduction letters dated 09 March 2022.

How to apply

If you are not in receipt of Council Tax reduction and wish to make a claim then you can apply online.
 

Why have we changed the Council Tax Reduction scheme?

The old Council Tax reduction scheme did not always work for many residents who are receiving Universal Credit.
 
As Universal Credit is re-assessed every month, under the old Council Tax reduction scheme, a residents’ Council Tax bill may have been recalculated each month and a revised bill issued. This was a problem for workers receiving Universal Credit whose earnings might change each month.
 
By placing residents into income bands, which determines the percentage by which their Council Tax is reduced, someone’s income can fluctuate without issuing a revised Council Tax Bill and changing the current instalment plan.
 
In addition the scheme aims to ensure that all low income households are provided with financial support towards their Council Tax liability.
 

Income Bands

The Income bands under this scheme are based on the household having no children, 1 child or 2 children or more. Please note figures are based on weekly incomes.
 
Band No children 1 child 2 or more children Maximum award
1 Passported Households Passported Households Passported Households 95%
2 £0 - £59.99 £0 - £129.99 £0 - 199.99 80%
3 £60 - £129.99 £130 - £199.99 £200 - £269.99 60%
4 £130 - £199.99 £200 - £269.99 £270 - £339.99 40%
Income or savings above maximum
Income or savings above maximum
Income or savings above maximum
0%
 

Passported Households

To qualify as a passported household the claimant and / or partner must be in receipt of:
  • Income Support
  • Jobseekers Allowance (Income Based)
  • Employment Support Allowance (Income Related)
  • Universal Credit and not working

Income to be taken into account for the bands

  • Net average earnings from employment
  • Rental income
  • Private / occupational pensions
  • Spousal maintenance
  • Maternity Allowance
  • Statutory sick pay
  • Jobseekers Allowance (contribution based)
  • Employment and Support Allowance (contribution based)
  • Widowed Parent’s Allowance
  • Any other unearned income not specified below

Income to be disregarded

  • Child benefit
  • Child maintenance
  • Disability Living Allowance
  • Personal Independence Payments
  • Carers Allowance
  • Employment Support Allowance (Support component)
  • Universal Credit (earnings only taken into account)

Earnings disregards

  • There will be a single rate earnings disregard for working households of £20 with all previous earnings disregards being abolished.

Capital Limit

  • Upper capital limit £6000 or above
  • Capital under £6000 fully disregarded

Other adults in the household

Flat rate deduction in respect of any other adults in the household in addition to the claimant and / or partner of:
  • £5 per week not working
  • £10 per week in work
Council Tax payers who experience financial hardship can still apply online for assistance under the Council Tax reduction hardship fund.
 
For the first year of the new scheme there is some transitional protection for those whose Local Council Tax Support reduces resulting to an increased amount of Council Tax to pay. The protection will cushion the yearly increase to £260.71 or £5 per week. 
 
For example:
Year Scheme award Payable tax
2021/2022 Local Council Tax Support Scheme award of £1657.24 Council tax payable of £445.64
2022/2023 Local Council Tax Support Scheme award of £865.28 Council tax payable of £1297.93 before transitional protection
2022/2023 Transitional Protection award £591.58 Council tax payable £706.35

This help will be assessed after 01 April 2022 as the total amount of the detrimental change will need to be established. If you are eligible for any additional relief you will be contacted in due course.