Council Tax Reduction

We use the following types of income when working out your CTR:

• Universal Credit payment – Your net monthly earnings used in your Universal Credit claim. If you have no earnings, you will receive the maximum 84% reduction.
• Earnings – Your net monthly earnings (after tax, National Insurance, and half of pension contributions) including any overtime or back pay. Self-employed earnings.
• Unearned income - If you do not receive Universal Credit any Private Pensions or Superannuation you receive will be treated the same way as earnings.

The following types of income are not included when working out your CTR:

• Disability benefits and other government administered allowances - Examples include PIP/DLA and Attendance Allowance, Child Benefits, War Pensions and Cold Weather Payments.

If you are not claiming Universal Credit, you are self-employed and have been trading for more than 52 weeks, we may apply a Minimum Income Floor (MIF). This means we assume you earn up to the net national Living Wage for 35 hours per week, less tax and National Insurance. If your income is lower, we still use the amount. If you pay into a private pension, we can disregard half of the amount you pay into it.

You will need to provide:

• A summary of income and expenses for the last 13 weeks
• Receipts or invoices for business expenses
• Your most recent year end accounts
• Recent bank statements for your business or personal account (if used for business)

Taxi drivers must complete a separate income and expenditure form, as we need different information for this type of self-employment.

• Single claimants
• Couple claimants
• Families with one child (including lone parent families)
• Families with two or more children (including lone parent families)

Use the table below to find out the percentage your Council Tax bill will be reduced by. If your weekly net earnings (you and partner combined) fall into a band, that discount applies each day of entitlement. Add £20 per child to the band threshold.

You will pay the remainder. For example, if the table shows 84% discount you pay 16% of the bill.

Example

Sarah (single, 3 children)

Sarah earns £1,000 net earnings a month.

To work out monthly income into a weekly amount, use net earnings (after tax, NI and pension) then simply multiply the monthly amount by 12 and divide the result by 52.

• £1,000 × 12 ÷ 52 = £230.77 weekly.
• Band 3 limit for a single person is £200 + £60 (for 3 children) = £260.
• Her earnings (£230.77) are below this, so she falls into Band 3 (44% discount).

If you move from benefits into work and your income increases, you will stay in Band 1 until the start of the next financial year. This gives you time to adjust and budget before any change in your CTR.

If another adult (not your partner) lives with you, your CTR may be reduced.  This is called a non-dependant deduction.

Weekly deductions

• £10 per week if the non dependant works 16 hours or more
• £4 per week if they do not work

We check this using the information in your Universal Credit claim.

No deduction applies if you or your partner:

• Are blind
• Receive DLA (Care, middle or higher rate)
• Receive PIP (Daily Living)
• Receive Attendance Allowance

No deduction applies if the non dependant is:

• A full time student
• Receiving a training allowance under a youth training scheme
• Receiving Pension Credit

• The first £6,000 of your savings is ignored.
• For savings between £6,000 and £15,999, we assume a weekly income of £1 for every £500 (or part of £500).
• If you have £16,000 or more in savings, you will not qualify for CTR.