Council tax is based on the value of your home and which band it falls into, but the headline bill is only the starting point. A range of discounts, disregards and reductions can lower what you actually pay, and many people pay more than they need to because they do not claim them. This guide explains council tax bands, the main discounts including the single person discount, and how to check you are paying the right amount.
How council tax bands work
Every home is placed in a council tax band based on its value at a set date in the past, with band A the lowest and the higher bands covering more valuable properties. The band determines the basic amount of council tax you pay, and your council sets the actual charge for each band each year. Two similar homes in the same area in the same band will pay the same basic charge, before any discounts or reductions are applied.
The single person discount
If you are the only adult living in your home, you can get a single person discount of 25% off your council tax bill. This applies regardless of your income or savings, so it is not means-tested, and it is one of the most common discounts. If you live alone and are not getting this discount, contact your council, as you should be, and you may be able to have it backdated. Remember to tell the council if someone moves in, as the discount then stops.
People who are not counted
Some adults are disregarded for council tax, meaning they are not counted when working out how many adults live in a home. If everyone in a home is disregarded, there can be a large discount. Disregarded groups include full-time students, certain apprentices, people who are severely mentally impaired, such as some people with dementia, and some carers. If a disregarded person lives with one other adult, the household can often get the 25% discount, as if only one adult lived there.
The severe mental impairment discount
A particularly valuable and often-missed reduction applies where someone is medically certified as having a severe mental impairment, which can include conditions such as dementia, and they also receive a qualifying benefit. Such a person is disregarded for council tax, which can lead to a 25% discount, or a much larger reduction if they would otherwise be counted as the second adult. This is widely under-claimed, so it is well worth asking your council about it.
The disability reduction
If your home has features that are needed because someone living there is disabled, such as an extra room used for their needs, a downstairs bathroom, or space to use a wheelchair indoors, you may qualify for a disability reduction. This reduces your bill to the rate of the band below your actual band, or lower for the lowest band. This is separate from the discounts above, and recognises the extra space disabled people often need, so check whether it applies to your home.
Empty and second homes
The rules work the other way for empty and second homes. Councils can charge extra council tax on homes that are left empty for a long time, and many now charge a premium on second homes as well. So if you own a property that is empty or a second home, you may pay more rather than less. If your home is empty for a genuine reason, such as major repairs, check whether any exemption or reduction applies in your case.
Checking and challenging your band
If you think your home is in the wrong band, perhaps because similar nearby homes are in a lower band, you can ask the Valuation Office Agency, or the equivalent in Scotland, to review it. Be aware that a review could move your band up as well as down, so it is worth researching comparable properties first. If your band is reduced, you may also get a refund of overpaid council tax going back to when you became liable.
Annexes and other situations
There are further reliefs for particular situations. For example, a self-contained annexe used by a relative may qualify for a discount, and there are exemptions for some properties, such as those left empty because the person who lived there has gone into hospital or a care home, or has died. The rules can be detailed, so if your household has an unusual arrangement, it is worth asking your council whether any discount or exemption applies.
Backdating a discount
If you discover you have been paying full council tax when you were entitled to a discount, such as the single person discount or a disregard, ask your council to backdate it. In many cases discounts can be applied for a past period, which can lead to a refund. It is always worth raising it, because councils do not automatically know your circumstances, and you may have been overpaying for some time without realising.
Tell the council about changes
Just as you should claim discounts you are entitled to, you must also tell the council when your circumstances change in a way that ends a discount, such as another adult moving in and ending your single person discount. Reporting changes keeps your account correct and avoids building up arrears or a penalty. Keeping the council up to date in both directions makes sure you pay the right amount, no more and no less.
How the discount appears on your bill
When a discount or reduction applies, it is taken off your annual bill and your instalments are usually recalculated for the rest of the year. If a discount is awarded part way through the year, or backdated, you may see a credit or a lower set of remaining payments. Always check your bill after a change to make sure the right discount has been applied, and contact your council if the figures do not look right, as mistakes can happen.
In short
Council tax depends on your property's band, but discounts and reductions can cut your bill. The single person discount gives 25% off if you live alone, and disregards for students, carers and people with a severe mental impairment can reduce it further. There is also a disability reduction, while empty and second homes can cost more. Council Tax Reduction can help on top if you are on a low income.
Do not assume you are paying the right amount
The overall lesson with council tax is not to assume your bill is correct or that nothing can be done. Many households are entitled to a discount, a disregard, a disability reduction, or a lower band, and never claim it. Take a few minutes to check whether any of these apply to you, and contact your council if they do. A small amount of effort can lead to a lower bill, and sometimes a refund of money you have overpaid over the past few years.
Where to get help
Your council and Citizens Advice can check which discounts you qualify for. If you are on a low income, also claim Council Tax Reduction, explained in our guide to Council Tax Reduction.