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Do I Have to Pay Council Tax?

Ways to Save on Council Tax

There is an old saying, there are two things we cannot avoid, death and taxes. And one of those taxes is Council Tax.

For the majority of us, we pay Council Tax, even as a tenant you pay it, the tax is not included as a part of your rent, although in some shared housing or HMO’s (houses of multiple occupations), the Council Tax may be included as a part of the rent.

And Council Tax is considered a priority bill, a bill that is to be paid each month just like rent. Some Councils charge the tax on a 10 month basis, some on a 12 month basis, but either way, it is to be paid.

As to the consequences of not paying your Council Tax? These can be quite severe and harsh, more local authorities use Bailiffs than almost anyone else. The threat of Bailiffs knocking at your door is a strong impetus to pay the tax.

Unfortunately, local Councils this time of year announce any changes in the tax, which as you can probably guess, is being raised by most authorities. The Councils receive less funding from the Parliamentary level, so they need to make up this lack of funding, and one way to do so is to increase Council Tax.

So to answer the question, do you have to pay Council Tax? Yes, you do, but there are ways to minimise what you are required to pay, if you fit into some of the reduction categories.

Ways to Save on Council Tax

Council Tax has been around since the early 90’s, and to many, it is antiquated and needs to be changed/reformed.

Our properties are placed in a Band based on their valuation, and the “tax” is then assessed for each Band.

The problem is that property values were last assessed in 1991, which is what….28 years ago!

Many properties have appreciated or gone up in value since then. So you may think we are being done a favour, no increase in property value, no increase in Council Tax.

However, someone living in a small flat, may find themselves in the same band as someone who owns a semi-detached house, which on the surface and even beneath, does not seem fair.

However, there are a few ways to get a reduction and save on paying Council Tax.

Sole Occupancy Discount: I you live alone, you can get a 25% discount on your Council Tax. This is called a Sole Occupancy Discount.

On Benefits/Hardship Reduction: If you are receiving any benefits, or have been made redundant, you may be eligible for Council Tax support, or a reduction in what you are required to pay for Council Tax. The reduction can be quite substantial, and if you are not working and/or are receiving benefits, you need to explore this option.

Student Exemption: If a property is occupied solely by students, then there is an exemption to pay Council Tax. The key here is, only occupied by students.

Vacant Property Discount: If as a landlord one of your properties has been vacant for six (6) months, you can apply for a discount. The degree of discount you may receive will vary according to the different Councils.

Holiday Home Discount: If you own a holiday home, which is not your primary residence, some Councils offer a discount on Council Tax for these. You need to inquire with your local Council.

If you feel you are paying too much in Council Tax, you can always challenge your band with the Council.

Much can happen to a property over the years, and your property may be in the wrong band, and by challenging this, you almost have nothing to lose. There are no new valuations, and it is a small percentage who challenge the bands that see an increase.

Exemptions

There are some properties that can be exempt from Council Tax, those are:

* The property is empty due to a death

* The property is owned by a charity

* All those who reside there are under the age of 18 (unsure how that works)

* All those that reside there have “severe mental impairments”, I am assuming like a care home

* It is the resident of Diplomats

* The property is a “granny flat” or in-laws suite, where a dependant relative resides

So we do have to pay Council Tax, but there are some ways to reduce what we pay, or possibly be exempt.

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