Check how council tax works and if you have to pay

Council tax is a system of local taxation collected by local councils. It is a tax on domestic property. Generally, the bigger the property is, the more tax will be charged. Some property will be exempt from council tax.

Valuation lists and bands

Each local council keeps a list of all the domestic property in its area. This is called the valuation list. Each property is valued and put into a valuation band. A different amount of council tax is then charged on each band.

Revaluation and rebanding

Before April 2005, all domestic property was valued at April 1991 prices and put into a valuation list known as the 1993 valuation list.

In April 2005, all domestic properties were revalued at April 2003 prices and put into new valuation bands on the 2005 valuation list.

Valuation bands from April 2005

Finding out what band a domestic property is in

To find out what band a domestic property is in you can:

• inspect a copy of the valuation list – see below
• look at the council tax banding lists published on the internet by the Valuation Office Agency at www.voa.gov.uk
• check with your local council in advance of receiving a council tax bill
• if you are the liable person, you can also find the valuation band from the council tax bill or from an alteration to the valuation list by the listing officer

A copy of the valuation list is kept at the local council's main offices and is available for public inspection. Local councils might also make the list available in other offices, including libraries. You can look at and make copies of the valuation list at the local council's office or at the local valuation office. There might be a small charge.

If an alteration is made to the valuation list, including adding a new domestic property to the list, the listing officer will inform the liable person.

Properties exempt from council tax

Some properties are exempt from council tax altogether. They might be exempt for only a short period, for example, 6 months, or for a longer time.

Properties which may be exempt are:

• property which is unoccupied and substantially unfurnished for up to 6 months
• property which is unoccupied and substantially unfurnished and is undergoing major repairs or alterations for up to 6 months
• property which is unoccupied and has been condemned
• property which is unoccupied and has been re-possessed by a mortgage lender
• property unoccupied because the person who lived there now lives elsewhere because they need to be cared for, for example, in hospital (or with relatives)
• property which is unoccupied because the person who lived there has gone to care for someone else
• any property that only students, or Foreign Language Assistants on the official British Council programme, live in. This may be a hall of residence, or a house. If the property is occupied by both students and non-students the property is not exempt but any students in the house are disregarded
• a caravan or boat on a property where council tax is paid
• a property where all the people who live in it are aged under 18
• a property where all the people who live in it are either severely mentally impaired or are students or where there is a mixture of both
• a self-contained ‘granny flat’ where the person who lives in it is a dependent relative of the owner of the main property.

If you think that your property should be exempt, talk to an adviser.

Who has to pay council tax

Usually one person, called the 'liable person', is liable to pay council tax. Nobody under the age of 18 can be a liable person. A couple living together will both be liable, even if there is only one name on the bill.

Usually, the person living in a property will be the liable person, but sometimes it will be the owner of the property who will be liable to pay.

The owner will be liable if:

• the property is in multiple occupation, for example, a house lived in by a number of people who all pay rent, but no-one is responsible for paying the whole of the rent
• the people who live in the property are all under the age of 18
• the people who live in the property are all asylum seekers who are not entitled to claim benefits
• the people who are staying in the property have their main homes somewhere else
• the property is a care home

If only one person lives in a property they will be the liable person. If more than one person lives there, a system called the 'hierarchy of liability' is used to work out who is the liable person. The person at the top, or nearest to the top, of the hierarchy is the liable person. Two people at the same point of the hierarchy will both be liable.

The hierarchy of liability is:

1. a resident who lives in the property and who owns the freehold
2. a resident who lives in the property and who has a lease
3. a resident tenant or contract holder
4. a resident who lives in the property and who is a licensee. This means that they are not a tenant or a contract holder, but have permission to stay there
5. any resident living in the property, for example, a squatter
6. an owner of the property who does not live there

Check how much the council tax is

Each year, every local council sets a rate of council tax for each valuation band. Not everyone will have to pay the full amount of council tax. There are a few ways in which your council tax bill may be reduced. These are:

• the reduction scheme for disabled people
• discounts
• a Council Tax Reduction, or a discretionary reduction

Reduction scheme for people with disabilities

If there is someone (adult or child) living in a household who has a disability the council tax bill for the property might be reduced. The reduction is made by charging council tax on a lower valuation band than the one the property is in. For example, if the property is in band D, the council tax bill will be worked out as if it were in band C. From 1 April 2000, this reduction also applies to properties in band A.

To claim a reduction you must show that a disabled person lives in the property, and also that the property meets that person’s needs.

An application for this reduction must be made in writing to the local council. Many local councils will have an application form. Some will ask for supporting evidence, for example, a doctor’s letter.

If you think that you might be entitled to a reduction because someone in your household is disabled, you should talk to an adviser.

Discounts

If only one person lives in a property they will get a 25% discount on the council tax bill. When working out how many people live in a property, some people are not counted. These are called disregarded people.

People are disregarded if they are:

• aged 17 or under
• prisoners
• in detention prior to deportation or under mental health legislation
• defined as a severely mentally impaired person
• a full-time student on a qualifying course of education. Foreign Language Assistants on the official British Council programme are also counted as students for the purposes of Council Tax. If the property is occupied only by students then it is exempt from council tax altogether
• a spouse or a dependant of a student and a non British Citizen who is not allowed under immigration rules, either to work in the UK or claim benefit
• Student nurses or Project 2000 student nurses
• young people on government training schemes, apprentices, or foreign language assistants
• hospital patients who live in hospital
• living in a residential care home, nursing home, or mental nursing home where they receive care or treatment
• living in a hostel which provides care or treatment because of a person’s old age, physical or mental disability, past or present alcohol or drug dependence or past or present mental illness and in England and Wales a bail or probation hostel
• carers
• care workers
• staying in a hostel or night shelter, for example, in a Salvation Army or Church Army hostel
• school or college leavers still aged under 20 who have left school or college after 30 April - they will be disregarded until 1 November of the same year whether or not they take up employment
• aged 18 and someone is entitled to child benefit for them - this includes a school or college leaver in remunerative work, or a person in local authority care
• members of a religious community
• members of visiting armed forces and their dependants

If everyone who lives in the property is disregarded, there will still be a council tax bill, but there will be a 50% discount.

If you're staying at the property but it is not your main residence, you also count as disregarded. If you're the only person living there and your main property is somewhere else, this property will count as your second home and special rules might reduce the discount allowed.

A local council might automatically send a council tax bill which includes a discount. The discount will be shown on the bill.

If you believe that you are entitled to a discount and your bill doesn't show that you have had one, you should apply to the local council for a discount, as soon as possible.

If the bill shows that the local council has applied a discount and you don't think that you should have one, you must tell the local council within 21 days. If you don't do this the local council might later impose a penalty.

Holiday homes and second homes

If you have a holiday home or second home, the local council might give you a discount of 25% or 50% - or they might not give you any discount.

You can check the local council's rules about council tax discounts on their website. If you’re not sure which council area your home is in, you can find the local council on GOV.UK. 

If you rent your property out as a self-catering holiday let you might not have to pay council tax - you pay business rates instead.

You won’t have to pay council tax if all of the following apply to the property:

• it was available to let for at least 252 days in the last year

• it was actually let for at least 182 days in the last year

• you plan to let it for at least 252 days in the next year

You can find out more about business rates for self-catering holiday lets on GOV.UK.

Council Tax Reduction and discretionary reductions

If you're liable to pay council tax, you might be entitled to a Council Tax Reduction. The amount of reduction you can get will depend on your income and capital.

Whether or not you qualify for a Council Tax Reduction, you can ask your local council to make a discretionary reduction off the bill. You should set out your circumstances when you ask them to consider your request. If you aren't happy with their decision about your request you can complain or appeal.

For more information about help with council tax, or how to appeal against a decision about Council Tax Reduction or discretionary reduction, see Help with your council tax – Council Tax Reduction.

Empty homes premium for long-term empty properties

The council can charge you an 'empty homes premium' if your home is empty and unfurnished for 1 year or more - you pay this on top of your council tax.

The premium can be up to 300% of your council tax.

If your property is already exempt from council tax, you won't be charged the empty homes premium. You also won't be charged the premium if your property is:

• on the market - either for sale or to let, for up to 1 year

• the only or main residence of a member of the armed forces, who is living in armed forces accommodation for work 

• an annex being used as part of your main residence

How to pay council tax

Council tax bills should be sent out in April.

You have the right to pay by 10 instalments, you can also ask to pay by 12 instalments. The local council might accept weekly or fortnightly payments.

Some councils might also offer a reduction in the total bill if it is paid all at once, at the beginning of the year.

Arrears

If you don't pay an instalment of council tax within 28 days of the date it is due, and have been late with two instalments previously, you lose the right to pay by instalments and become liable to pay the full amount immediately. In practice, most local councils will still accept payments by instalments.

If you haven't paid an instalment of council tax within 28 days of the date it is due, the local authority might ask a magistrates court to issue a court summons for the arrears. If these aren't paid by the date of the court summons, the local council can ask the magistrates to issue a liability order.

A liability order allows a local authority to make arrangements for the arrears to be paid by deductions from a person's income support, jobseeker’s allowance or wages, or for bailiffs to seize a person’s goods to the value of the amount owed.

If you are in council tax arrears, you should talk to an adviser.

Appeals

Appeals can be made about a range of issues about the council tax. An appeal must be made to either the valuation office or the local council depending on what it's about.

Appeals can be made to the valuation office about:

• whether or not the property should be on the valuation list
• which valuation band the property is in (see under Valuation lists and bands under heading What is Council Tax)
• in a property which is partly domestic and partly business, what proportion of the property is domestic

Appeals can be made to the local authority about:

• whether or not someone is a liable person. This includes someone who is jointly liable because there are 2 or more people on the same level of the hierarchy or a person is jointly liable because they are one of a couple
• whether or not the property is exempt
• whether or not a discount applies and how much it is
• whether or not the reduction scheme for people with disabilities applies

Appeals cannot be made about the level of council tax set or each valuation band for the area.

Who can appeal

The following people can appeal against a decision of the valuation office:

• the owner of the property
• the liable person, including a person who is jointly liable - there are special rules about when a liable person can appeal about the valuation band of a property 
• the person who would be liable if the property was not exempt
• the local council

The following people can appeal against a decision of the local council:

• a liable person, including a person who is jointly liable
• an aggrieved person - this is a person who is directly affected by the decision, for example, the administrator of the estate of a liable person who has died

Usually, people who wish to appeal must have moved into the property for less than 6 months, or be in a new property which has recently been added to the valuation list. Special rules apply to appeals regarding the valuation band a property has been put in.

Appeals to alter the valuation band of a property

The valuation list may be altered to place a property in a different valuation band if:

• there was an error when the list was compiled
• the property was valued incorrectly, for example, because the valuation officer did not know about internal features of the property which reduced its value
• in a property which is partly domestic and partly business, the domestic proportion has increased or decreased, or the property has become wholly domestic or wholly business
• there have been changes to the property which have reduced its value
• there have been changes to the property which have increased its value and the property has subsequently been sold

There are special rules about when a liable person can appeal regarding the valuation band a property has been put in.

Time limits for an appeal about the valuation band a property has been put in

Different time limits have been set for appealing about a valuation banding of a domestic property in the 1993 valuation list and the 2005 valuation list.

Time limits for appeals to alter the valuation band in the 1993 valuation list

An appeal to alter the valuation band of a property in the 1993 valuation list must be made not later than 31 December 2005. An appeal can only be made if:

• the liable person for a property changes. The new liable person(s) will have 6 months from the date they become liable or up until 31 December 2005, whichever is the sooner, to make a proposal to change the valuation band, or
• a property has recently been added to the valuation list. The liable person has 6 months from the date they become the liable person or up until 31 December 2005, whichever is the sooner, to make a proposal to change the list.

There are some special circumstances when the time limit of 31 December 2005 can be extended. If you want to know more about this, talk to an adviser.

Time limits for appeals to alter the valuation band in the 2005 valuation list

If a domestic property is in the 2005 valuation list on 1 April 2005, then an appeal can be made by the person liable to pay council tax on 1 April 2005 to alter the valuation band between 1 April 2005 and 30 September 2006.

If the liable person for a property changes, the new liable person(s) will have 6 months from the date they become liable to make a proposal to change the valuation band. So, for example, if you became the liable person on 1 May 2005 you would have 6 months from 1 May 2005 to make a proposal to change the list. This is provided that your grounds for the proposal have not already been considered and rejected by a valuation tribunal or the High Court.

If a property has been added to the valuation list since 1 April 2005, the liable person has 6 months from the date they become the liable person to make a proposal to change the list. In practice this means 6 months from the date the property goes onto the valuation list.

The procedure

Appealing to the valuation office

In order to appeal you must first make a proposal to the valuation office saying what you think should be changed and why. If the valuation office do not agree to the changes, the proposal automatically becomes an appeal and is heard by a valuation tribunal.

Properties can only be put in a different band under certain circumstances, for example, if something has happened to reduce the value of the property significantly.

Appealing to the local council

The first stage of an appeal to the local council involves making a written complaint about the problem to the local council. If the local council does not resolve the problem, an appeal can then be made to the valuation tribunal.

The Valuation Tribunal

In all cases the valuation tribunal will consider all the information about the particular case and will decide what should happen. They may decide on the basis of written representations or may call everyone involved to a meeting to hear their evidence.

You can get more information on the Valuation Tribunal for Wales website at: www.valuation-tribunals-wales.org.uk.

If you want to make an appeal either to a valuation office or a local authority you should talk to an adviser.

Particular circumstances

There are particular points to remember in the following circumstances:

• If you live permanently in a hotel – you will not be liable for council tax on the property although the hotel charges would probably include an amount towards any council tax payable
• If you have more than one home – you might pay a reduced council tax on your second home (if no-one lives there) and a full council tax on your main home
• If you own caravans or mobile homes – if you live permanently in a caravan or mobile home you will pay the council tax. People who have a fixed caravan as a holiday home will pay business rate. Towing caravans kept at your home will not be subject to either council tax or business rate
• If you are a full-time student in advanced education – you will have to pay council tax if you are the liable person for a property. However, if all the people living in the property are students no council tax will be payable and if some of the residents are students the council tax may be reduced.

If you are in any of these groups and need further information you should talk to an adviser.