Couple gets 'severe mental impairment' council tax discount backdated TEN years after appeal - how to fight for a backdated payment

In 2019, Alison (who asked not to give her second name), applied for a 25% council tax discount on her and her husband Colin's home in County Durham, due to Colin being severely mentally impaired after a stroke.

If someone is diagnosed as severely mentally impaired (SMI), they can be 'disregarded for council tax purposes' in England, Scotland and Wales. We've been campaigning to raise awareness of this discount for years, with our investigation in 2017 revealing that 10,000s could be missing out on up to £400 a year, and Alison found out about the discount after reading our site.

The couple's local authority – Durham County Council – allowed them to pay a reduced rate going forwards and said it would backdate the discount to 2013, but refused to backdate it further.

But Colin and Alison challenged the case at the Valuation Tribunal, and it ruled last year that the council hadn't taken reasonable steps to ascertain whether Colin and Alison were eligible for a discount. It found that as Colin's GP had certified that he was severely mentally impaired from 2009 and he was eligible for the care component of Disability Living Allowance, the discount should be backdated to then.

As our How to claim the 'severely mentally impaired' council tax discount guide explains, not all councils allow you to apply for a backdated discount, but Colin and Alison's case demonstrates that even if they don't allow you to, you can challenge the decision. See more on how to do that below.

How the SMI council tax discount works

By law, someone who has been medically certified as having a permanent condition that affects their intelligence and social functioning (eg, Alzheimer's or severe learning difficulties, but many other conditions may apply) is 'disregarded for council tax purposes' in England, Scotland and Wales. It means you can claim:

• A 25% discount – if you live with someone with a severe mental impairment and no other adults, or only adults who have also been disregarded for council tax purposes.

• A 100% discount – if you have a severe mental impairment and live alone.

To qualify for the reduction, the person must not only be medically certified as being SMI, but must also be eligible for – but not necessarily actually receiving – at least one of a number of benefits (see a full list), such as disability living allowance.

Why Alison and Colin were able to get their discount backdated

Although local authorities uniformly offer this discount on future council tax payments, they don't all allow you to apply for a backdated discount. Yet if your council refuses to backdate a refund, you can challenge this.

Council tax rules - to be precise, Regulation 14 of the Council Tax (Administration and Enforcement) Regulations 1992 - state that councils must take "reasonable steps" to ascertain whether a council tax discount applies, and the Ministry of Housing, Communities and Local Government says you can challenge the date from which any exemption might apply. 

In Alison and Colin's case, they were told they could get a backdated discount, but only for six years, to 2013. So they took their case to the Valuation Tribunal and said that they should also have been given a discount between 2009 and 2013, when Colin was eligible, arguing that the council had failed to take "reasonable steps" to offer the discount in that period.

In the Tribunal Ruling last summer, the Senior Member (the equivalent of the judge in this situation), said that while the local authority had produced a council tax booklet and leaflet explaining the discount for the 2018/19 financial year, it had not provided them between 2009 and 2013. She added: "Furthermore, I could not find any other documentation to show that it had brought possible entitlement to a discount disregard to the attention of the appellant or his spouse."

She also said that Alison and Colin had submitted a council tax benefit application in 2009 and that a lot of personal information would have been provided to support that application, but that there was no evidence that the council took any steps to alert the couple to their entitlement to a discount.

'We got £1,250 back because of the extra backdating'

Speaking about the tribunal case to help encourage others to fight for a backdated discount , Alison said: “I didn’t know anything about SMI in 2009 - it’s only in the last few years whilst perusing the MSE site that I've leaned about it.

"I originally went to the council to claim the SMI discount in 2019. They initially offered us the discount in the future and six years' backdating. They did say we could challenge the backdating at the time.

"My 17-year-old daughter had a look and thought we had a good case to challenge this and ask for further backdating. Going to the tribunal did involved some extra work, but I’ve reclaimed PPI before and that was - to be honest - more difficult than this. If you can write a good letter, you’re part way there. Go for it and give it a chance.

"We didn’t actually go to the tribunal because of coronavirus, they did it online – it wasn’t even via Zoom or anything, they did it internally. It might be a bit more stressful if you had to go. 

‘We ended up getting over £1,269 extra back [on top of the £2,225 originally awarded] because of the extra backdating. We’ve used it to do stuff on the house - it’s gone towards redecorating, getting a kitchen extension and other bits and bobs."

Durham County Council said it agreed with the tribunal's findings and was "truly sorry" for any upset caused. Its head of finance, Paul Darby, told us: "We have reviewed our internal procedures in order to learn from this case and take on board the steps which should have been taken to further support [the claimant] through the process without the need to have to go to tribunal.

“As a council, in recent years we have worked hard to raise awareness of discounts and exemptions available for council tax and ensure that our residents are able to access the support available to them in this regard. Our officers have been instructed to be flexible in terms of backdating awards to ensure residents receive the full exemptions, discounts and disregards to which they are entitled.

Want to challenge a backdating decision? Here's what to try

To claim an SMI council tax discount, you'll need to contact your council - the exact process varies by area, so you'll need to check your local authority's procedure. See our guide for more details on how to claim. If you believe your refund should be backdated, it's worth explaining this when you make the initial claim.

Some councils may automatically backdate your refund, but if yours doesn't - or it doesn't backdate it far enough, then here's to fight the decision:

• First appeal to the council directly. Before you can appeal externally you'll need to ask the council to reconsider its decision. The process for this may vary by council so contact it to find out.

• If the council still says no, you can take your case to the Valuation Tribunal. The Valuation Tribunal Service is an independent, publicly-funded appeals body you can go to if you want to challenge a council tax decision . Appealing is free and it can involve an in-person hearing, though during the pandemic cases are being handled online. You may not even need to speak to anyone, as was the case for Alison and Colin.

  You can submit an appeal via the Valuation Tribunal Service website. When doing this, it's worth preparing evidence of the grounds you are complaining on. For example, you could dig out any old emails of old correspondence with your council, that shows they should have been aware of your eligibility for the SMI discount in the past.

Success ISN'T guaranteed - it depends if a council took "reasonable steps"

Colin and Alison's successful appeal hinged on their council being found not to have taken reasonable steps to ascertain whether they were eligible for the discount from 2009. However exactly what counts as "reasonable steps" isn't defined in law, so this is a grey area - each case is taken on its own merits.

Craig Suddick, owner of council tax consultancy LGFA92 and a former local authority taxation officer, told us that in his experience, a council can successfully argue it has taken "reasonable steps" if it sends out information out about discounts with its annual demand notice.

However he said there may be exceptions to this, so it's not clear-cut. For example, if a council has sent out info about discounts with its annual demand notice it may still not have taken "reasonable steps" if it has info to suggest a discount may apply and it doesn't investigate it sufficiently. This may have been a factor in Alison and Colin's case, as when they first made a council tax benefit application in 2009 they provided lots of info about Colin's health.

In short, if you believe you should be owed a backdated refund it's worth fighting your case and going to the Valuation Tribunal if necessary - but be aware that it will rule on each case on its own merits, so the outcome will depend on your specific situation and there's no guarantee of success.