Council tax discounts

Many are entitled to discounts that can help save £1,000s

Many people are eligible for a council tax discount or reduction of between 25% and 100%, saving £100s – or even £1,000s – each year. Those living alone or only with children, people on a low income, students, those with a carer or a specific medical diagnosis, and even people with empty properties are among those who could cut their bill. Read on to see who's eligible, how much you might save, and how to apply.

Watch Martin's three-minute council tax discounts briefing

Before reading the full detail below, first watch MoneySavingExpert.com founder Martin Lewis's three-minute introductory video on council tax discounts and why many households could be missing out on discounts worth £100s – or possibly £1,000s – every year.

Embedded YouTube Video

This clip has been taken from The Martin Lewis Money Show Live on Tuesday 16 January 2024, with the permission of ITV Studios. All rights reserved. Watch the full episode on the ITVX Hub.

Who can get money off their council tax bill?

There are all sorts of reasons you might qualify for a lower council tax bill. These can be separated into three broad categories: those based on the types of people who live in your home; those based on being on a lower income or receiving certain benefits; and those based on the type of property you live in

First, we're focusing on discounts based on who you live with. In brief, the amount of council tax you pay depends on the number of 'qualifying adults':

  • TWO or more qualifying adults in a household – means that no discount applies, and the full council tax is due.

  • ONE qualifying adult in a household – means that a single person discount applies, equivalent to 25% off the council tax bill.

  • NO qualifying adults in a household – results in either a discount of 50% or a 100% exemption, depending on exactly who lives in the property. Though note that having no qualifying adults is not the same as when a property is unoccupied.

Below we explain in a bit more detail who counts as a qualifying adult and who doesn't. But to give you an idea we've summarised the potential household set-ups that might get you a discount in this graphic. The main types of people are:

  • Qualifying adults
  • Students
  • SMI adults – those diagnosed with a 'severe mental impairment'
  • Live-in carers

Who is 'disregarded' for council tax?

As mentioned above, certain people don't qualify to pay council tax, meaning they are 'disregarded'. These include:

  1. Children. You won't be considered for council tax purposes until you turn 18.

  2. Full-time students. To count as a full-time student, your course must last at least a year and involve at least 21 study hours a week.  Full-time student nurses can normally claim this discount too (and some councils also let part-time student nurses apply as well).

    Certain apprenticeship schemes also count, as does getting funding from the Education and Skills Funding Agency (if you're under 25) and foreign language assistants registered with the British Council.

  3. Adults considered to be 'severely mentally impaired' (SMI). This could include those who have Alzheimer's, Parkinson's, profound learning difficulties, multiple sclerosis or who have had a severe stroke.

    To qualify, you’ll need to be both medically certified as having an SMI, and be receiving at least one of a number of benefits (in Scotland, being eligible for the benefit even if you don't actually claim it is sometimes enough).

    We've got a whole guide on claiming the 'severely mentally impaired' council tax discount, so it's best to read that if this is how you or your household qualify.

  4. Live-in carers. Live-in carers are disregarded if they look after someone with a disability who isn't their partner, spouse or child under 18, for an average of at least 35 hours a week – looking after a mother, father, brother, sister, niece, nephew, friend, uncle or aunt DOES count. The person cared for must be getting one of the following benefits:

    - Attendance allowance.
    - Middle or higher rate of the care component of disability living allowance.
    - Standard or enhanced rate of the daily living component of personal independence payment.
    - An increase in constant attendance allowance.
    - An increase in disablement pension.

    As a live-in carer you do NOT need to be receiving carer's allowance to qualify for this council tax discount. More than one person in a household can qualify as a live-in carer, so long as each fits the qualifying criteria above.

  5. Ukrainian refugees. If you host a Ukrainian refugee in your home as part of the Homes for Ukraine scheme, it won't affect any discounts or reductions you're already entitled to.

Where you don't fall into any of the categories above, you will be classified as a qualifying adult for council tax purposes. Yet if you are the only qualifying adult in the household, you will be eligible for a single person discount, which is a 25% discount off your bill.

If you are eligible for a discount, you'll need to apply to get it

  • Watch Martin's original council tax discounts briefing

    Martin explains how council tax discounts work:

    Embedded YouTube Video

Reductions based on your income

You might also qualify for money off your council tax bill based on your household income. Unlike the discounts mentioned above (which apply regardless of where you live), each council operates its own reduction scheme – meaning the size of any reduction and the qualifying criteria vary by local authority.

If you are eligible for a reduction, you'll need to apply to get it. 

You're on a low income and/or benefits 

If you're on a low income or claim benefits, such as universal credit, your household may qualify for a council tax reduction – which can be as much as 100%. It doesn't matter if you own your own home or rent, or whether you're employed or not. Yet what you get depends on:

  • Where you live
  • Your circumstances (such as income, number of children, benefits, residency status)
  • Your income, including savings, pensions and your partner's income
  • If any children or other adults live with you.

When working out your income, councils in England can partly or fully disregard things like child maintenance, fostering payments and charity contributions – see your council's website for its full list. Disregarded income should also include any payments you get in relation to Windrush (such as the Windrush Compensation Scheme) and historic child sexual abuse.

Some MoneySavers have told us they've been able to get the 25% single person discount in addition to a low-income reduction.

You're receiving pension credit

If you or your partner are getting the 'guaranteed' part of pension credit, your household could be eligible for a full reduction on your council tax bill of up to 100%. 

If you get the 'savings' part of pension credit, then you might also be eligible for a reduction, though this won't be a full reduction – how much you'll get will depend on how much you have in savings. And if you live with any adults who aren't dependent on you, then the reduction might also be less.

Some time ago you mentioned about claiming for pension credit. I own my home, no mortgage, I have savings and Premium Bonds. I really didn't think I would get anything. I did, backdated, and also will not have to pay council tax. Many thanks, Martin x

Susan, via email

Reductions & discounts based on your property

Some people can get a discount or reduction off their council tax bill because of the property itself. If you are eligible for a discount, you'll need to apply to get it

Properties adapted for a disabled person – drop a band

Council tax bill.

If your home has been adapted for a disabled person, and you can demonstrate this, you’ll drop a council tax band. Where your property is already in band A (the lowest council tax band) and you qualify for this discount, your council tax bill will be reduced by 17% instead.

The types of adaptations could include:

  • An extra bathroom or kitchen for a disabled person to use.

  • A room that's 'predominantly' used by a disabled person. For example, this could be a downstairs room in a two-storey house that has been turned into an accessible bedroom. Or a room that has been adapted specifically for a disabled person to use.

  • The creation of sufficient floor space to make the home accessible for someone who uses a wheelchair.

After you mentioned disability rates relief I emailed my local council, and they sent me a form to complete. Three weeks later I was informed that my band had been reduced from E to a D, saving me over £400/yr going forward. Not only that, the discount was backdated to the time I came out of rehab following an above-the-knee leg amputation, meaning an extra pay-out of £1,500. Thank you so very much, I wouldn't have known about this reduction otherwise.

John, via email

Properties being renovated to make them liveable – possible 100% exemption

For unoccupied properties which are undergoing MAJOR repair work or structural alterations to make them habitable, you may be able to claim a council tax exemption.

If your property fits the category above, you will be exempt from council tax for up to 12 months.

Properties that are empty

There are some instances where you don't have to pay any council tax on an empty home. These include:

- You're a long-term resident of a care home or hospital. Here you don't need to pay any council tax on your home, unless you're only in hospital or a home for a short time – recovering from an accident, for example – in which case you'll need to pay council tax as normal.

- You're in prison. If the property's now empty, you do not need to pay council tax on it (unless you're in prison for not paying council tax).

- The owner of the property has died. If the home's empty, it's exempt from council tax until someone new moves in, or probate is granted. If probate has been granted and the home is still empty and hasn't been sold, it will be exempt from council tax for a further six months. If it's still empty and unsold after six months, the executor will be responsible for paying council tax from the estate.

If you've inherited a house from someone who's died, you're responsible for paying council tax once the transfer has been completed.

  • How much council tax do I pay on an empty property that isn't exempt?

    If your empty home isn't exempt, you will have to pay council tax. In fact, if your home's empty (and unfurnished) for two or more years, your council can charge an extra 100% in council tax if your home's in England or Wales.

    If it's in Scotland, this premium can be charged after a year, and it can be up to an extra 100% (so effectively your council tax could be doubled). This is to avoid having lots of empty properties up and down the country.

  • What if I'm in the armed forces and stationed away from home?

    If you're in the armed forces and stationed away, you won't be charged extra council tax, but will need to pay the normal amount.

Properties with an annexe

If your home has an annexe (informally known as a 'granny annexe') or similar extension, you might get a discount provided it's in use as a residence or used by the main homeowner.

An annexe is typically described as a self-contained and separate living area from your main home, though your council will have to decide whether or not it qualifies as an annexe. 

If you qualify as having an annexe, you will receive two council tax bills – one for the annexe and a separate one for the rest of your home. You're entitled to a discount of 50% on the annexe's council tax bill, but you'll still pay council tax as normal on the main house.

Properties that are second homes but not usually lived in 

If you have to live in a second property for your job, for example, you live there during the week, or own a holiday home, some councils will give you a discount. This does not include buy-to-let properties.

Councils can give a discount of up to 50%, but it's up to the council to decide both if it'll offer the discount in the first place and how much it will be.

Entitled to a discount or reduction? You need to apply to get it

As mentioned above, discounts and reductions can be worth £100s off your council tax bill each month. You might even be able to backdate too, though councils set their own rules regarding backdating – so if they do allow it, you'll normally need to explain why you hadn't claimed before. 

However, the important thing to remember if you believe you're eligible for a discount or reduction is that YOU MUST APPLY as it won't happen automatically.

  • Those in England / Wales. Visit the Gov.uk to find your council's details.

  • Those in Scotland. Visit the Mygov.scot website to find your council's details.

Depending on what kind of discount or reduction you are applying for, you'll likely be asked to provide evidence to support your claim. For example, if you're claiming a reduction based on having a low household income, you might be asked to provide evidence of your identity, rent or mortgage payments, income and savings.

Where your application is successful but your circumstances later change, do inform your local council as it may mean you're no longer eligible for a reduced bill.

Q&A: Council tax

  • Do I have to pay my council tax over 10 months?

    Many people have complained to us that council tax is paid over 10 months rather than 12, making monthly budgeting difficult (as you pay monthly for 10 months, then get a two-month holiday). Yet all councils in England must allow you to pay your council tax over 12 months.

    However, we've heard there are worries that as it may impact their cash flow, some councils may not be very loud in telling people about this option. If you want to change how you pay, it's safest to contact it yourself.

    How do I do this? If you live in England, contact your council and tell it you want to change to the new payment schedule. Make sure to check your new bill when it arrives to see that the schedule has definitely changed.

  • Who is responsible for paying council tax?

    This section on liability is only for those living in England. 

    Working out who, technically, is legally responsible for paying a household's council tax bill is more complicated than you might think – as we discovered when trying to answer this question.

    For many households this likely won't be an issue as – regardless of the legal technicalities – you simply split the bill evenly between the adult occupants (or some variation on this). The intention of this chapter isn't to mess with that practical arrangement.

    Rather, in the event there's a disagreement about who should be paying (or maybe you're just curious to know), there is a method to determine who should be footing the bill...

    Familiarise yourself with the council tax 'hierarchy of liability'

    Buried deep within the Local Government Finance Act 1992 is a section on council tax liability, which sets out who in a household is legally responsible for paying.

    Known as the 'hierarchy of liability', this section specifies six kinds of person, each occupying a certain rung on the hierarchy. Where someone fits the criteria specified by the first rung, they will normally be responsible for paying the council tax bill.

    If nobody is classified as fitting the first rung of liability, then responsibility passes to anybody on the second rung. Where nobody sits on the second rung, responsibility moves to anybody on the third rung, and so on. 

    The hierarchy of liability is as follows:

    1. Resident with a freehold interest
    2. Resident with a leasehold interest
    3. Resident with a statutory or secured tenancy
    4. Resident with a contractual licence to live in the property
    5. Resident
    6. Owner of the property

    For the purposes of council tax, a 'resident' is defined as somebody who is at least 18 years of age, and has his or her 'sole or main residence' in the relevant property.

    Where two or more people occupy the same rung – for example, a household that consists of a couple who are both named on the tenancy agreement – responsibility for paying the bill is divided equally between them. This is known as being 'jointly and severally liable'.

    Joint and several liability also applies to married and civil partner couples (and couples living together as if they were married or civil partnered) where one of the people is on a higher rung of the hierarchy than their partner.

    There are some exceptions to the hierarchy

    To add further complication to working out who's responsible for paying the council tax bill, there are some exceptions to the hierarchy of liability to consider. In brief:

    • Some households are exempt from paying council tax in the first place (meaning the hierarchy of liability is not applicable). This includes households which contain only full-time students or only people with SMIs – or a combination of both.

    There's also an exception to the joint and several liability rule:

    • Joint liability doesn't apply to full-time students and people with SMIs. This means where a household is mixed, and includes at least one person who is a full-time student or somebody with an SMI, as well as another adult (or adults) who are on the same rung of liability, joint liability won't apply as per normal. In such a scenario, the student / person with an SMI would not be legally responsible for paying council tax, and the bill's liability would be jointly split between the remaining occupant or occupants.

    Examples of council tax hierarchy in practice

    As you might've gathered, working out who's legally liable to pay council tax can be complicated. To help, we've come up with nine different scenarios, split between three groups.

    • Households containing students

    • Households where someone is cared for

    • Households on low incomes

Other MSE council tax guides... 

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