What is council tax?
Council tax is a charge paid to your local council to pay for local services. It goes towards services like policing, street cleaning, park maintenance and the fire service, along with other local support in your community. It is paid to your local council, who will allocate the funds themselves.
How is council tax calculated?
The value of your property, and the number of people living in it will impact your council tax payments. Your property will be assigned to a band from A - H, and a bill will be generated for the year. Most people will pay the recommended amount by monthly direct debit, over 10 months.
You will often receive a letter from your local council, offering a breakdown of how council tax has been spent in your area.
What are the council tax bands?
The council tax bands run from A-H, increasing with the value of the property on a specific date (April 1st 1991). Council tax bands are different in England, Scotland and Wales.
Council tax bills in England:
- A - properties up to £40,000
- B - £40,000 - £52,000
- C - £52,000 - £68,000
- D - £68,000 - £88,000
- E - £88,000 - £120,000
- F - £120,000 - £160,000
- G - £160,000 - £320,000
- H - more than £320,000
In Scotland, council tax is worked out in the same way, using bands based on property value on 1st April 1991, but the bands are different.
Council tax in Scotland:
- A - Up to £27,000
- B - £27,000 - £35,000
- C - £35,000 - £45,000
- D - £45,000 - £58,000
- E - £58,000 - £80,000
- F - £80,000 - £106,000
- G - £106,000 - £212,000
- H - more than £212,000
Council tax in Wales is actually calculated on the value of the property on 1st April 2003.
Council tax in Wales:
- A - up to £44,000
- B - £44,000 - £65,000
- C - £65,000 - £91,000
- D - £91,000 - £123,000
- E - £123,000 - £162,000
- F - £162,000 - £223,000
- G - £223,000 - £324,000
- H - £324,000 - £424,000
- I - more than £424,000
Northern Ireland doesn’t use the council tax system, but has a system based on domestic rates. This means the value of your property is multiplied by a domestic rate based on the area you live in, and your tax bill is calculated by this.
How is council tax paid?
You receive a council tax bill when moving into a new property, or they are sent out in April, with a breakdown of how much you would pay per month over 10 months.
If you do not pay and do not make arrangements with the council, you will lose the right to pay by direct debit and the whole amount will be required.
Who is council tax exempt?
In the UK, most people over the age of 18 who rent or own a property will have to pay council tax.
If you are a full time student in the UK, you won’t pay council tax on your property. In some cases, if you are a low income earner, your council tax reduction will be paid back as a rebate. You should discuss this with your local authority.
Are there council tax discounts?
If you are living alone in your property you are able to claim a 25% discount on your council tax bill.
This discount also applies if you live with people but none of them are elegible to pay council tax, for example all your housemates are full-time students, or they're under 18. You can read more about who doesn't count as an adult when it comes to paying council tax
If you have a second home or holiday home, you will have to pay council tax on that, but there is often a discount.
There is also a ‘disabled band reduction scheme’ which means that if your property has been specifically adapted to support a person with a disability who lives there, you may get the reduction down to the next council tax band. You will need to apply for this reduction scheme through your local council.
Can I change my council tax?
If you think the band on your property may be incorrect (perhaps it differs from your neighbours) then you can ask for it to be reconsidered. However, bear in mind that it may mean you go up a band instead of down. You can find more about querying your council tax band at moneysavingexpert.
Finding out the council tax at my new property
Many property portals actually offer a breakdown of bills when you look at a new home, and council tax is often included in that. So when you’re looking at property listings, keep an eye out for the council tax band. Otherwise, you can use the government website to work out your council tax by postcode.
Updated February 2020