In April 2013, the Government abolished the national Council Tax Benefit scheme for working age customers and asked each Council to replace it with a local scheme called Council Tax Support, now called Council Tax Reduction.
Council Tax Reduction is a local scheme designed to help people on low incomes pay their Council Tax. Pensioner claims for Council Tax Reduction are determined according to a national scheme, which is set by the government.
Pension Age Council Tax Reduction
The national scheme compares a customer's income and capital to an applicable amount, which is the amount the government says a person needs to live on - based on their age, household and any disability. Under the national scheme, a customer can receive up to 100% help towards their Council Tax. A non-dependant deduction for other adults in the property, other than the customer and their partner, usually reduces entitlement - the amount depending on the non-dependant's income. No non-dependant deduction is taken if the customer or their partner is in receipt of Attendance Allowance, Disability Living Allowance Care Component or the Daily Living part of Personal Independence Payment.
Unlike Housing Benefit and other state benefits, only one member of a couple needs to be of pension age to be considered under the pension age Council Tax Reduction scheme. The exception is if the couple receive a working age benefit, such as Universal Credit, Income-Based Jobseeker's Allowance, Income Support Allowance or Income-Related Employment and Support Allowance. Visit the GOV.UK website to check your State Pension age.
Visit the GOV.UK website for details of independent and free-to-use benefits calculators to calculate an estimate of the pension age Council Tax Reduction you may be entitled to. These calculators will also give an estimate of Housing Benefit.
State Pension age customers may be entitled to Pension Credit paid by the Department for Work and Pensions. Visit the GOV.UK website to find out if you're eligible for Pension Credit.
Working Age Scheme from April 2020
Following a consultation in Autumn 2019, the council's Council Tax Reduction Scheme (formerly known as Council Tax Support) for working age customers changed to an Income Grid-based scheme from 1 April 2020.
Some of the main features of the working age scheme are:
- the capital limit is £6,000 - anyone with capital above this level won't qualify
- there are no non-dependant deductions
- those who have been self-employed for more than 12 months and who are earning less than the equivalent rate of 30 hours at the National Minimum Wage (or the National Living Wage for those aged 25 or over), minus the relevant amount of tax, National Insurance and 50% of any pension contribution, will have this level of self-employed income applied to their claim
- claims and changes of circumstances take effect from either the date they are received or the date the change happened
- claims can be backdated for up to 3 months from when the request is received.
Income Grid 2024/2025 (1 April 2024 to 31 March 2025)
| Council Tax Reduction level | Passported @ | Single + | Couples + | Families with one child + | Families with two or more children + |
|---|---|---|---|---|---|
| Level 1 - 90% | Relevant Benefit | £0 to £91.28 | £0 to £143.63 | £0 to £221.53 | £0 to £300.65 |
| Level 2 - 75% | Not applicable | £91.29 to £127.80 | £143.64 to £186.22 | £221.54 to £270.22 | £300.66 to £355.43 |
| Level 3 - 50% | Not applicable | £127.81 to £164.32 | £186.23 to £228.83 | £270.23 to £318.91 | £355.44 to £410.20 |
| Level 4 - 25% | Not applicable | £164.33 to £200.83 | £228.84 to £271.43 | £318.92 to £367.59 | £410.21 to £464.98 |
| @ Passported / Relevant Benefit; includes customers on Income-Based Jobseeker's Allowance, Income-Related Employment and Support Allowance, and Income Support. + Weekly eligible income; all income received by the applicant and any partner, excluding any income detailed in the income disregards listed below. |
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Income disregards
Benefits
The following benefits are disregarded in full when working out a customer and their partner's total weekly eligible income:
- Armed Forces Independence Payment
- Attendance Allowance
- Bereavement Support Payment for one month
- Carer's Allowance, Child Benefit
- Disability Living Allowance
- Personal Independence Payment
- Support component of Employment and Support Allowance
- Universal Credit Housing Costs (pro-rata amount where full Universal Credit is not being paid)
- War Widow(er)'s Pension
- War Disablement Pension, including Service Attributable Pensions.
Earnings
Tax, National Insurance and 50% of any pension contributions are disregarded from earned income. In addition, the first £20 of earnings are disregarded per claim where the claimant or partner are working. Only one £20 earnings disregard is applied per couple.
Apply for Council Tax Reduction
View information on how to apply for Council Tax Reduction
Hardship
If a customer of either working or pension age cannot afford the shortfall between their weekly Council Tax Reduction and their weekly Council Tax liability, they can apply for Council Tax Reduction Hardship Assistance. Those in receipt of Universal Credit but whose income is too high to qualify for Council Tax Reduction can also apply for Council Tax Reduction Hardship. View the Council Tax Reduction Hardship Assistance page for more details on this scheme.
Cost of Living Discount April 2023
To help with the cost of living, customers who receive Council Tax Reduction will receive a one-off extra discount of up to £100 off their annual Council Tax bill. So, if a customer is entitled to Council Tax Reduction on 1 April 2023 and their bill is less than £100, this extra discount will reduce their bill to zero. If their annual bill is over £100, they will receive a £100 reduction. There is a maximum Cost of Living Discount of £100 per bill, so for those who are jointly liable for Council Tax and separate Council Tax Reduction claims, they will receive up to a £100 reduction from their bill.
The discount will be automatically added to the 2023/24 Council Tax bill of those who are entitled. It will show on the bill as Cost of Living Discount Apr 23.
We hope that this extra support will help our residents during these difficult times. This additional discount for April 2023 has been part-funded up to £25 per eligible customer by the government’s Council Tax Support Fund.
Policy documents
- Download the current Council Tax Reduction Policy for 2024/2025 for more information on the Council Tax Reduction Scheme from 1 April 2024.
- Download previous Council Tax Reduction and Council Tax Support policy documents for more information on previous schemes and policies.
Last updated: 08/04/2024 15:38
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