Council Tax Reduction scheme

What is the Council Tax Reduction Scheme?

Our Council Tax Reduction scheme is designed to support those on a low income to help pay their Council Tax. Your income, savings and personal circumstances affect how much Council Tax Reduction you can claim. 

If you’re receiving Universal Credit how you claim Council Tax Reduction has changed. As of April 2021, we’ve introduced a banded scheme to make the amount of Council Tax Reduction you’re entitled to month to month more stable.

How does the new scheme work? 

The scheme works by placing your income (we work-out your income using figures supplied by the DWP) into a band of income. Your income will change if your Universal Credit is recalculated, but providing your income stays within the income band, your Council Tax bill will not change.

There are different income bands for each size of family, to take into account the amounts of Universal Credit that different sizes of family receive.

What does this mean for me?

  • For residents on Universal Credit, the scheme has changed to a banded income scheme.
  • For pension-age residents, and residents not on Universal Credit, the new scheme works in the same way as the old scheme.
  • The amount of Council Tax Reduction under this new scheme will generally be at least as much as under the old scheme.

Why have we changed the Council Tax reduction scheme?

Our old scheme did not work very well for many residents who are on Universal Credit.

Because Universal Credit can be recalculated each month, under our old scheme, a resident’s Council Tax Reduction might also be recalculated each month, and a revised Council Tax bill issued. This was a problem for workers on Universal Credit, whose earnings might fluctuate each month, due to variable working hours, or other factors.

Each time a new Council Tax bill was issued, a new payment instalment plan was offered, over-riding the previous one. The new instalment plan often started before the first instalment of the previous plan had become due. This meant that our residents could not make payments according to their plan.

Under the new banded income scheme, we place resident’s income within a “band” of income, and that band determines the percentage by which their Council Tax is reduced. For example, if someone’s income is £290 per week, they are placed in a band of income £289 to £307, which gives 32% off the Council Tax.

If, in the following month, this person’s income changed to £300 per week, it will still be in the band £289 to £317, and the Council Tax Reduction stays the same. The Council will not need to issue a revised Council Tax bill and that person’s Council Tax instalment plan remains the same.

A public consultation on this proposal was held during August and September. On 8 October, the Council’s Leadership Team agreed to introduce a banded income scheme, from April 2021.

Last updated: 17 March 2023