Pay Apply Report

Legal definition of the Council Tax Reduction Scheme

See our Council Tax Reduction Scheme 2018-2019 (PDF: 1.42Mb \ 185 pages)

A summary of the Scheme is set out below.

There are six classes of person entitled to Council Tax Reduction under the Scheme, each with a number of qualifying criteria.

Class A - Pensioners whose income is less than the applicable amount

The main criteria for Class A are:

  • the applicant must be a pensioner, or a pensioner couple;
  • the applicant must not have capital above £16,000. For couples, the combined figure must not exceed £16,000; and
  • the applicant's income, or combined income for couples, for the period in question. It must be less than their applicable amount. The applicable amount is the Government's assessment of the amount the claimant needs to live on. It takes into account the number of people in the household and any additional requirements for disabilities.

If an applicant is in receipt, or whose partner is in receipt of a guarantee credit, we count the whole of his capital and income as zero.

If an applicant meets the criteria for Class A, they will qualify for 100% reduction in their Council Tax liability. We may adjust the reduction if there are non-dependants in the household.

Class B - Pensioners whose income is greater than the applicable amount

The main criteria for Class B are:

  • the applicant must be a pensioner, or a pensioner couple;
  • the applicant must not have capital above £16,000. For couples, the combined figure must not exceed £16,000; and
  • Council Tax liability is higher than 20% of the difference between income and the appropriate applicable amount. This is as calculated for Class A.

If an applicant meets the criteria for Class B, their Council Tax reduction will be less than 100%. For example:

Description £
Weekly Council Tax Liability (A) 28.76
Weekly Income (B) 353.64
Applicable Amount (C) 258.83
Excess Income (B minus C) 94.81
20% of Excess Income (D) 18.96
Weekly Council Tax Reduction (A minus D) 9.80

Class C - alternative maximum Council Tax reduction - pensioners

The main criteria for Class C are:

  • the applicant must be a pensioner. If they have a partner, the same must be true for the partner, with some exceptions. We must also disregard the partner for Council Tax purposes. This could be someone with a chronic mental health condition; and
  • there must be at least one second adult living with the applicant who is not a partner. They do not pay rent and are on a prescribed low income or benefit

Class 3 replicates the current second adult rebate scheme. It is the income of the 'second adult' that determines the level of reduction awarded. The reduction awarded can be 7.5%, 15%, 25%. If all adults are in receipt of certain benefits, it is 100%.

Class D - persons who are not pensioners whose income is less than the applicable amount

The main criteria for Class D are:

  • the applicant must be under the qualifying age for state pension credit. If they have a partner, the same must be true for the partner. There are some exceptions;
  • the applicant must not have capital above £16,000. For couples, the combined figure must not exceed £16,000; and
  • the applicant's income (or combined for couples) must be less than their applicable amount. The applicable amount is the Government's assessment of the amount the claimant needs to live on. It takes into account the number of people in the household and any additional requirements for disabilities.

If an applicant meets the criteria for Class D, they will qualify for 100% reduction in their Council Tax liability. We may adjust the reduction if there are non-dependants in the household.

An applicant in receipt of:

  • income support;
  • income-related Job Seeker's allowance; or
  • income-related employment and support allowance

will have both income and capital counted as zero.

Class E - persons who are not pensioners whose income is greater than the applicable amount

The main criteria for Class E are:

  • the applicant must be under the qualifying age for state pension credit. If they have a partner, the same must be true for the partner. There are some exceptions;
  • the applicant must not have capital above £16,000. For couples, the combined figure must not exceed £16,000; and
  • Council Tax liability is higher than 20% of the difference between income. This is as calculated for Class D, the appropriate applicable amount.

If an applicant meets the criteria for Class E, their Council Tax reduction will be less than 100%. The example shown at Class B explains the calculation.

Class F - alternative maximum Council Tax reduction - persons who are not pensioners

The main criteria for Class F are:

  • the applicant must be under the qualifying age for state pension credit. If they have a partner, the same must be true for the partner. There are some exceptions. We must also disregard the partner for Council Tax purposes. For example, someone with a chronic mental health condition; and
  • there must be at least one second adult living with the applicant who is not a partner. They do not pay rent and are on a prescribed low income or benefit.

Class F replicates the current second adult rebate scheme. It is the income of the 'second adult' that determines the level of reduction awarded. The reduction awarded can be 7.5%, 15%, 25%. If all adults are in receipt of certain benefits, it is 100%.

Administration

Regulations prescribe the dates from which:

  • claims start;
  • backdating provisions;
  • dates from which prescribed change of circumstances take effect; and
  • notification of decisions.
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