What is council tax
Council tax is a system of local taxation collected by local authorities. It is a tax on domestic property. Some property is exempt from council tax. Some people do not have to pay council tax and some people get a discount.
All home are given a council tax valuation band by the Valuation Office Agency (VOA). The band is based on the value of your home on 1 April 1991. A different amount of council tax is charged on each band. Each local authority keeps a list of all the domestic property in its area, together with its valuation band. This is called the valuation list.
The valuation bands are:
Finding out what band a property is in
To find out what band a property is in, you can:
- inspect a copy of the valuation list held by your local authority – see below
- look at the council tax valuation lists published on the internet by the Valuation Office Agency (VOA) at: www.voa.gov.uk
- check with your local authority
- if you are the person responsible for paying council tax (the liable person), check your council tax bill. For more information about who is a liable person, see under heading Who has to pay council tax.)
A copy of the valuation list is kept at the local authority's main offices and is available for public inspection. Local authorities may also make the list available in other offices, including libraries. There may be a small charge.
If the valuation list is changed, for example, if a property is put into a different band, the VOA will write to the council tax payer, informing them of the change. The local authority will then issue a revised council tax bill.
Properties exempt from council tax
Some property is exempt from council tax altogether. It may be exempt for only a short period, for example, six months, or indefinitely.
Properties which may be exempt include:
- condemned property
- property which has been legally re-possessed by a mortgage lender
- property unoccupied because the person who lived there now lives elsewhere because they need to be cared for, for example, in hospital, in a care home or with relatives
- property which is unoccupied because the person who lived there has gone to care for someone else
- any property that only students or Foreign Language Assistants on the official British Council programme live in. This may be a hall of residence, or a house. If the property is occupied by both students and non-students the property is not exempt but any students in the house are disregarded
- a holiday caravan or boat if it's on a property where council tax is paid
- a property where all the people who live in it are aged under 18
- property which is occupied only by people with severe mental impairment
- a self-contained ‘granny flat’ where the person who lives in it is a dependent relative of the owner of the main property.
If you think that your property should be exempt, you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB.
Who has to pay council tax
Usually one person, called the liable person, is liable to pay council tax. Nobody under the age of 18 can be a liable person. Couples living together will both be jointly and severally liable, even if there is only one name on the bill. This applies whether the couple is married, cohabiting or in a civil partnership. No one is under an obligation to make a payment until they are issued with a bill in their name or, if they are jointly and severally liable, with a joint taxpayers' notice.
Usually, the person living in a property will be the liable person, but sometimes it will be the owner of the property who will be liable to pay.
The owner will be liable if:
- the property is in multiple occupation, for example, a house shared by a number of different households who all pay rent separately; or
- the people who live in the property are all under the age of 18; or
- the property is accommodation for asylum seekers; or
- the people who are staying in the property are there temporarily and have their main homes somewhere else; or
- the property is a care home, hospital, hostel or women's refuge.
If you think that the owner of the property should be paying the council tax, you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB.
If only one person lives in a property they will be the liable person. If more than one person lives there, a system called the hierarchy of liability is used to work out who is the liable person. The person at the top, or nearest to the top, of the hierarchy is the liable person. Two people at the same point of the hierarchy will both be liable.
The hierarchy of liability is:
- a resident owner-occupier who owns either the leasehold or freehold of all or part of the property
- a resident tenant
- a resident who lives in the property and who is a licensee. This means that they are not a tenant, but have permission to stay there
- any resident living in the property, for example, a squatter
- an owner of the property where no one is resident.
How much is the council tax
Each year, every local authority will set a rate of council tax for each valuation band. Not everyone will have to pay the full amount of council tax. There are three ways in which your council tax bill may be reduced.
- the reduction scheme for disabled people
- Council Tax Reduction and second adult rebate.
Reduction scheme for disabled people
If there is someone (adult or child) living in a household who is substantially and permanently disabled the council tax bill for the property may be reduced. The reduction is made by charging council tax on a lower valuation band than the one the property is in. For example, if the property is in band D, the council tax bill will be worked out as if it were in band C. This reduction also applies to dwellings in band A. The reduction will be the same proportion of the council tax bill as the properties in the higher bands.
To claim a reduction you must show that a disabled person lives in the property, and also that the property has at least one of the following:
- an extra kitchen or bathroom to meet the needs of a disabled person
- any other room (except a toilet) which is mainly used by a disabled person to meet their needs
- enough indoor space for a disabled person to use their wheelchair.
An application for this reduction must be made in writing to the local authority. Many local authorities will have a special application form. Some will ask for supporting evidence, for example, a doctor’s letter.
If you think that you may be entitled to a reduction because someone in their household is disabled you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that give advice by email, click on nearest CAB.
If only one adult lives in a property, they will get a 25 per cent discount on the council tax bill. When working out how many people live in a property, some people are not counted. These are called disregarded people.
You are disregarded if you are:
- aged 17 or under
- a prisoner or someone in detention awaiting deportation or under mental health legislation
- 'severely mentally impaired'
- full-time students on a qualifying course of education (including correspondence or on-line courses); student nurses; Foreign Language Assistants on the official British Council programme. If the property is occupied only by students then it is exempt from council tax altogether
- a spouse, civil partner or a dependant of a student who is a non- British Citizen and who, under immigration rules, is not allowed either to work in the UK or claim benefit
- a young person on a government training scheme or following some kinds of apprenticeship
- a long-term hospital patient or care home resident
- living in a hostel which provides care or treatment because of your old age, physical or mental disability, past or present alcohol or drug dependence or past or present mental illness
- living in a bail or probation hostel
- a live-in care worker
- staying in a hostel or night shelter, for example, in a Salvation Army or Church Army hostel
- a school or college leaver aged under 20 and you have left school or college after 30 April. You will be disregarded until 1 November of the same year whether or not you take up employment
- aged 18 and someone is entitled to Child Benefit for you
- a member of a religious community
- a member of a visiting armed force. Your dependants are also disregarded.
If everyone who lives in the property is disregarded, there will still be a council tax bill, but there will be a 50 per cent discount.
Example 1: You are ‘severely mentally impaired’ and live in a property with your carer. You are both disregarded people. You are entitled to a 50 per cent discount on your council tax.
Example 2: You are living alone in a flat on a temporary basis because of a short-term job. Your main home is somewhere else, where you’re paying council tax. You are a disregarded person. However, the flat counts as your second home and so you might get a discount of between 10 per cent and 50 per cent. This depends on the policy of the local authority where your second home is located.
A local authority may automatically send a council tax bill which includes a discount. The discount will be shown on the bill.
If you believe that you are entitled to a discount and your bill does not show that you have had one, you should apply to the local authority for a discount, as soon as possible.
If the bill shows that the local authority has applied a discount and you do not think that you should have one, you must tell the local authority within 21 days. If you do not do this, the local authority may later impose a penalty.
A local authority can offer a discount of 100% or less, or even no discount at all, on a property which is:
- empty and substantially unfurnished. The reduction applies for a maximum of six months and the property has to be vacant for the whole of this period. This includes a caravan or boat which is used as main residence but which is unoccupied
- empty because it needs major repairs or alterations to make it habitable. The reduction applies for a maximum of 12 months whether the work is actually finished or not by then (although up to six weeks of occupation during the period is allowed). This includes a caravan or boat which is used as main residence but which is unoccupied.
Holiday homes and second homes
In England, holiday homes or second homes will be liable for council tax. However, councils can offer a second homes' discount of 50% or less, or even no discount at all, because no one lives there on a permanent basis. This depends on the policy of the local authority where your holiday home or second home is located. If it is in Wales or Scotland the discount may vary. In England, there are some special cases where local authorities have no discretion and the second home discount must be set at 50%. These are where:
- the second home is owned by someone who cannot live there because they have to live elsewhere in England, Wales or Scotland because of their job or their partner's job
- the second home is a pitch with a caravan on it or a mooring occupied by a boat.
Discounts for family annexes
From 1 April 2014, local authorities must offer a 50 per cent discount on an annexe within a main property if the annexe is used by the occupiers of the main property or by their immediate family members, including parents and teenagers.
However, an annexe is exempt if it is occupied by dependant relatives, that is to say those aged 65 or over, or substantially or permanently disabled or severely mentally impaired. In addition you will not be charged an empty homes premium on a long term empty annexe.
Council Tax Reduction and second adult rebate
A person who is liable to pay council tax may be able to get:
- a council tax reduction
- a one-off discount or write-off of some of your arrears
- second adult rebate. If you have someone living with you who is not liable to pay the council tax on your property, you may be able to claim a benefit called a ‘second adult rebate’. You will not be able to get a second adult rebate as well as Council Tax Reduction. If you are entitled to both, you will receive whichever is the higher.
For details of Council Tax Reduction and second adult rebate, see Council Tax Reduction – what you need to know.
Empty homes premium for long-term empty properties
Local authorities may charge an empty homes premium of up to 50 % on properties that have been empty and substantially unfurnished for two years or more.
Those properties which are already exempt from council tax will not be charged the empty homes premium. In addition, the following properties cannot be charged the premium:
- a property which would otherwise be the sole or main residence of a member of the armed forces, who is absent from the property as a result of such a service
- a property which forms a substantial annex to a dwelling, which is being used as part of the main residence in that dwelling.
How to pay council tax
Council tax bills should be sent out in April. You are usually asked to pay by 10 instalments. You have the right to ask to pay in twelve instalments instead. Local authorities may accept weekly or fortnightly payments. Some may also offer a reduction in the total bill if it is paid all at once, at the beginning of the year.
When you have not paid an instalment of council tax on the date it is due, your local authority must issue a reminder, asking for payment within seven days. If you fail to pay within this period, you lose the right to pay by instalments and a full year's council tax becomes payable.
If you don't pay this within the next seven days, your local authority can ask the magistrates to issue a liability order.
A liability order allows a local authority to make arrangements for the arrears to be paid by deductions from your Income Support, Employment and Support Allowance, Jobseeker’s Allowance or wages, or for bailiffs to seize your goods to the value of the amount owed. Alternatively, you could be sent to prison by the magistrate's court if you do not pay.
If your local authority issues you with three reminders for late payment of instalments within the same financial year, you will also lose the right to pay by instalments. A full year's council tax becomes payable when the third reminder is issued. However, in practice, your local authority may continue to accept payment by instalments, as long as they are paid on time.
If you are in arrears of council tax, you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB.
What to do if you think your council tax band is wrong
If you think your council tax band is wrong, you should first contact the Valuation Office Agency (VOA) on: 03000 505 505. Many enquiries can be sorted out on the spot.
In some cases, the VOA may review your band. They will write to you, usually within two months, to let you know their decision. Bear in mind that, if your home is already in band A, which is the lowest band, the VOA cannot reduce the band further.
In some cases, you can make a formal application to have your band changed. This is called making a proposal.
You can make a proposal within six months of:
- becoming a new council tax payer on a property
- the VOA notifying you that your banding has changed.
You can also make a proposal if:
- your property has been demolished
- substantial changes have occurred in the locality that have affected the value of your home as at 1 April 1991
- your property has been adapted for someone with a disability.
The VOA cannot delete a band just because a property is empty.
Where a band is deleted and the structural alterations are completed, the property will then be banded as a new property, reflecting all extensions and improvements. The new band may be higher than the one which was deleted.
The VOA have produced a factsheet which sets out their approach for properties that are in disrepair at www.voa.gov.uk.
If you want to make a proposal, ask the VOA to send you a proposal form to fill in. Or you can fill in a form online at: www.voa.gov.uk.
If you disagree with the VOA's decision on your proposal, you can appeal to an independent valuation tribunal – see under heading The valuation tribunal.
For more information about council tax banding, see the VOA website at: www.voa.gov.uk.
Other complaints about council tax
You can complain to your local authority if there is a dispute about:
- whether or not someone is a liable person. This includes a dispute about someone who is jointly liable because there are two or more people on the same level of hierarchy or where someone is jointly liable because they are one of a couple
- whether a property is exempt
- whether a discount applies
- whether or not the reduction scheme for people with disabilities applies to you
- whether the premium should be charged.
The following people can complain:
- a liable person, including someone who is jointly liable
- an aggrieved person. This is someone who is directly affected by the decision, for example, the administrator of the estate of a liable person who has died.
You must write to your local authority with your complaint. The local authority should send you a reply within two months.
If they do not agree with you, you can appeal against their decision to the valuation tribunal (see below). If the local authority does not reply within two months, you can appeal direct to the valuation tribunal without waiting for the reply of the local authority, as long as not more than four months have passed since you forest wrote to the local authority.
The valuation tribunal cannot hear appeals about why you have not paid your council tax or appeals about Council Tax Reduction. Also they cannot hear appeals about the level of a discount the local authority has decided to set for second homes or long-term empty homes. The level of these discounts can only be challenged in the High Court by a legal procedure called judicial review. You will need specialist legal advice before taking one of these cases.
The valuation tribunal
If you have complained to the VOA or local authority about any of the issues listed above and you are unhappy with the result, you can then write to the valuation tribunal to make an appeal. The valuation tribunal is an independent body. Usually three members will hear an appeal and a clerk advises on law and procedure. You do not have to pay to appeal.
There are time limits within which you can appeal – see above. When they get your letter, the valuation tribunal will acknowledge it and send you information about the procedure.
As soon as possible, they will send you a notice of the hearing – you will get at least four weeks' notice. You are advised to go to the hearing in person to put your case. However, if you prefer and you ask the valuation tribunal in writing, they can decide the case without you being there. If you have problems understanding English, they can provide an interpreter. They can also arrange to meet other needs if you are disabled, for example, if you have mobility problems or need special equipment.
In all cases the valuation tribunal will consider all the information about the particular case and will decide what should happen.
You can get more information about the valuation tribunal from their website at: www.valuation-tribunals.gov.uk.
If you want to make an appeal about council tax, you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.
There are particular points to remember in the following circumstances:-
- If you live permanently in a hotel – you will not be liable for council tax on the property although the hotel charges would probably include an amount towards any council tax payable
- If you have more than one home – you will probably pay a reduced council tax on your second home (if no-one lives there) and a full council tax on your main home. This depends on the policy of the local authority where your holiday home or second home is located. The VOA has produced a factsheet for England on holiday cottages which is available at www.voa.gov.uk
- If you own caravans or mobile homes – if you live permanently in a caravan or mobile home, you will pay the council tax. If you have a caravan that you let out as a business, you have to pay business rates, not council tax. Towing caravans kept at your home will not be subject to either council tax or business rate
- If you are a student or Foreign Language Assistant on the official British Council programme, you will have to pay council tax if you are the liable person for a property. However, if all the people living in the property are students or Foreign Language Assistants, no council tax will be payable. If some of the residents are students or Foreign Language Assistants, the council tax may be reduced.
If you are in any of these groups and need further information you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB.