Council Tax Reduction - how your income is worked out if you are treated as a pensioner
Are you treated as a pensioner for Council Tax Reduction (CTR) calculations
You are treated as a pensioner for CTR calculations if:
- you have reached the qualifying age for state pension credit (this may not be your actual age), and
- neither you, nor your partner is receiving income support, income-based jobseeker's allowance (JSA), income-related employment and support allowance (ESA) or Universal Credit (UC).
If you are part of a couple and only one of you has reached the qualifying age for state pension credit, for your application to be assessed under the pensioner rules it should be the person who has reached pension credit age who is the CTR applicant.
You can find information about the qualifying age for state pension credit on the GOV.UK website.
If you are treated as a pensioner for CTR calculations there are special rules about how your income is treated when calculating CTR.
The rules depend on whether you or your partner:
- get the guarantee part of pension credit
- get the savings part of pension credit, but not the guarantee part
- don't get pension credit.
The rules about calculating your income for CTR are complicated. Your local authority website may have a tool that you can use, but if you want more information about how income is treated for CTR, you should consult an experienced adviser, for example, at a Citizens Advice Bureau - where to get advice.
A one off payment up to £500 for NHS or social care workers working between 17 March and 30 November 2020 has to be disregarded in any calculation for council tax reduction. There is more information about this payment to NHS or social care workers on the Scottish Government website.
If you get the guarantee part of pension credit
If you or your partner get the guarantee part of pension credit, or both the guarantee part and the savings part, your income is ignored and you will be entitled to the maximum CTR, but there may be a deduction for any non-dependants who live in your household. Find out more about who is a non-dependant.
If you get the savings part of pension credit but not the guarantee part
If you or your partner get the savings part of pension credit but not the guarantee credit, the Pension Service will need to give your local authority the figure for your income that they used to calculate your savings credit. The local authority uses this figure to begin to work out how much CTR you are entitled to but some adjustments will have to be made to the figures.
If you don't get pension credit
If neither you nor your partner gets pension credit, the local authority will need to work out your income as a weekly amount to see if you are entitled to CTR and, if you are, how much CTR you are entitled to. Your income includes your partner's income. If you are claiming Universal Credit (UC), your local authority should use the UC maximum amount for your applicable amount. Find out more about the Universal Credit maximum amount.
If you don’t get UC, your income is worked out in a similar way to someone who is not treated as a pensioner.
If your income is the same as, or less than, the amount the government says you need to live on (called your applicable amount) you will receive maximum CTR, but there may be a deduction for any non-dependants. Find out more about who is a non-dependant and more about your applicable amount.
If your income is more than your applicable amount:
Step 1: Work out the difference between your applicable amount and your income.
Step 2: Work out what 20 per cent of the difference figure at step 1 is.
Step 3: Take this 20 per cent amount from your maximum CTR less any deduction for non-dependants. The result is the amount of CTR you are entitled to.
Water and sewerage charges
Don’t forget that you may still have to pay water and sewerage charges, collected with your council tax. Read more about help paying for water and sewerage.
Other useful information
More information about pension credit.