Council tax reduction scheme - Council tax reduction explained

Council Tax Reduction continues to provide money off your Council Tax bill if you are on a low income. The “reduction” is not to be confused with other Council Tax discounts such as Single Occupier Discount, which you can apply for, if you live alone. See the Council Tax pages for more details on discounts.

Bassetlaw District Council determines a Council Tax Reduction Scheme in January each year.

In summary the scheme will;

  • Be based on weekly net income and thresholds for needs  (means-tested);
  • Have full income disregards such as child benefit and war widows/ war disability income;
  • For working-age people (who are not classed as severely disabled) it will be based on  the  weekly council tax liability, limited to the equivalent of  a band C property (if higher)  but have a maximum amount or cap   of 88%. Therefore, you would have at least 12% of your Council Tax to pay yourself;
  • Have a maximum amount of 100% for pensioners (no cap);
  • For working-age people who receive the severe disability premium in their benefits,  will be based on the weekly council tax liability, limited to the equivalent  of  a band C property (if higher)  but have a maximum amount or cap of 95%. Therefore, you would have at least 5% of your council tax to pay yourself.;
  • Have a  hardship fund to help those with severe financial needs or exceptional circumstances;

Have an appeals process for disagreements with our decisions.

How we work out Council Tax Reduction

First, we  establish the weekly eligible income from the claimant and his/her partner, if they are in a couple. This varies depending on what the income is and whether any income disregards apply.  You must provide documentary proof of the income you receive. If you receive a benefit or allowance from the Department for Work & Pensions or Tax Credits, you should not rely on the DWP or HMRC notifying the Council. We can obtain proof of some benefits on-line such as Tax Credits, but not all of them, so please supply proof to the Council direct.

Earners and self-employed

We would  assess your weekly eligible income from earnings, based on at least 5 weekly or 2 monthly pay slips, if you are employed. These should ideally be the 5 weeks or 2 months prior to your claim date.

If you are self-employed, we would have to assess income based on a calculated net profit, not on any income you draw from the business. It is important to note that some business expenses are allowable for income tax purposes, but may not be in the calculation of Council Tax Reduction, so the net earnings from self-employment may be different to the net profit figure HMRC use. We usually use the profit/loss accounts for the previous year and determine the benefit period that this will apply to. . We can also accept your account books showing income and itemised expenses. However, this will always be evidence from a past period, to estimate your earnings for the coming benefit period. You should tell us if there is a change in the business or potential net profit, as soon as it occurs. Do not wait until your year end to notify us, or there could be an overpayment, which would have to be paid back.

Household

We would need to know about any dependent children in the household, as some additional allowance is made for children. We would also need to know about any other adults in the household, which are over 18 years. This is because there could be a deduction from your entitlement for each non-dependent person. In order to apply the correct deduction you would have to provide evidence of their weekly income.

Severe Disability

If you receive Severe Disability Allowance or the Higher rates of Disability Living Allowance (DLA) or Personal Independence Payment (PIP), we will consider whether you qualify to be placed in the Vulnerable CTR scheme which may attract a higher discount.

 

 


Last Updated on Tuesday, August 20, 2019

Council Tax Reduction continues to provide money off your Council Tax bill if you are on a low income. The “reduction” is not to be confused with other Council Tax discounts such as Single Occupier Discount, which you can apply for, if you live alone. See the Council Tax pages for more details on discounts.

Bassetlaw District Council determines a Council Tax Reduction Scheme in January each year.

In summary the scheme will;

  • Be based on weekly net income and thresholds for needs  (means-tested);
  • Have full income disregards such as child benefit and war widows/ war disability income;
  • For working-age people (who are not classed as severely disabled) it will be based on  the  weekly council tax liability, limited to the equivalent of  a band C property (if higher)  but have a maximum amount or cap   of 88%. Therefore, you would have at least 12% of your Council Tax to pay yourself;
  • Have a maximum amount of 100% for pensioners (no cap);
  • For working-age people who receive the severe disability premium in their benefits,  will be based on the weekly council tax liability, limited to the equivalent  of  a band C property (if higher)  but have a maximum amount or cap of 95%. Therefore, you would have at least 5% of your council tax to pay yourself.;
  • Have a  hardship fund to help those with severe financial needs or exceptional circumstances;

Have an appeals process for disagreements with our decisions.

How we work out Council Tax Reduction

First, we  establish the weekly eligible income from the claimant and his/her partner, if they are in a couple. This varies depending on what the income is and whether any income disregards apply.  You must provide documentary proof of the income you receive. If you receive a benefit or allowance from the Department for Work & Pensions or Tax Credits, you should not rely on the DWP or HMRC notifying the Council. We can obtain proof of some benefits on-line such as Tax Credits, but not all of them, so please supply proof to the Council direct.

Earners and self-employed

We would  assess your weekly eligible income from earnings, based on at least 5 weekly or 2 monthly pay slips, if you are employed. These should ideally be the 5 weeks or 2 months prior to your claim date.

If you are self-employed, we would have to assess income based on a calculated net profit, not on any income you draw from the business. It is important to note that some business expenses are allowable for income tax purposes, but may not be in the calculation of Council Tax Reduction, so the net earnings from self-employment may be different to the net profit figure HMRC use. We usually use the profit/loss accounts for the previous year and determine the benefit period that this will apply to. . We can also accept your account books showing income and itemised expenses. However, this will always be evidence from a past period, to estimate your earnings for the coming benefit period. You should tell us if there is a change in the business or potential net profit, as soon as it occurs. Do not wait until your year end to notify us, or there could be an overpayment, which would have to be paid back.

Household

We would need to know about any dependent children in the household, as some additional allowance is made for children. We would also need to know about any other adults in the household, which are over 18 years. This is because there could be a deduction from your entitlement for each non-dependent person. In order to apply the correct deduction you would have to provide evidence of their weekly income.

Severe Disability

If you receive Severe Disability Allowance or the Higher rates of Disability Living Allowance (DLA) or Personal Independence Payment (PIP), we will consider whether you qualify to be placed in the Vulnerable CTR scheme which may attract a higher discount.


Last Updated on Tuesday, August 20, 2019