It can be tricky to keep on top of exactly how much tax you should be paying – and if you're in the wrong band, you might be owed money. Here's all you need to know.
What are the council tax bands in England, Scotland and Wales and how can I check mine?
The council tax band system was introduced in 1991, with each home in the UK assigned a band according to the estimated value of their home at the time.
Band A represents the lowest value of a home (properties worth up to £40,000), while band H (I in Wales) represents the highest value (properties worth more than £320,000).
You can check your council tax band here, but a £300,000 house in England, for instance, would be "Band G". In Wales it would also be "Band G", while in Scotland a £300,000 would be "Band H".
Northern Ireland does not use the same council tax system as the rest of the UK.
MoneySavingExpert says that when the council tax system was brought in, the government didn't have time to get detailed information about each home in the UK, so the people it hired to do the valuations ended up allocating each property a band "with just a glance".
MSE said: "They became known as 'second-gear valuations' as they mostly never even stopped their cars, never mind got out of them."
This is why thousands of homes across the UK could be on the wrong council tax band, and paying the incorrect amount.
Chancellor Philip Hammond announced in his Autumn Budget that Local Authorities (LAs) will be given the power to charge a 100 per cent premium on empty properties.
Currently, the charge LAs can levy on a home is capped at 50 per cent.
Is anyone exempt from paying council tax?
IF you are over the age of 18 and either own or rent your own home, you must pay council tax.
But if you live on your own, or only live with a child and no other adult, you can get 25 per cent off your bill.
Full-time students and apprentices don't have to pay any council tax.
People with a severe mental disability are also exempt, as are people who are caring for someone with a disability who is not a spouse, partner, or child under 18.
How can I claim a refund?
If you're on the wrong council band, you could get hundreds of pounds back each year, and you might even get repayments backdated to when you first moved into the property – up to 1993 (or 2003 in Wales), which is when the tax came into effect.
In May 2018, it was revealed that tens of thousands of people in the UK could be due a refund on their council tax, according to MoneySavingExpert.com.
Their investigation found that some of those affected were in the wrong tax band while others were entitled to a full council tax refund due to having a severe mental impairment.
If a doctor has certified that someone has a permanent condition like Alzheimer's, parkinsons or a severe learning difficulty that hinders their intelligence or social functioning they have a legal right to have some or all of their council tax refunded.
If you live on your own and have a severe mental impairment you don't have to pay council tax and you can claim any council tax back that you have paid whilst you were living alone.
You are entitled to a 25 per cent discount if you live with an adult with severe mental impairment, or if all the adults in your home have medical conditions which mean they are exempt from paying council tax.
How do I apply for the council tax refund?
- Speak to your doctor about whether you have a severe mental impairment or not.
- If you do, then you need to ask you council for a Serious Mental Impairment application.
- After that you need to send the form back to the council with supporting evidence like your doctor's diagnosis.
- How long it takes to get your refund varies with different councils, so it is best to check with yours to see how long you will have to wait.
- Charities such as Alzheimer's Society, Carers UK and Dementia UK all offer free help and advice on how to claim back any council tax you are owed.
How do I check if I'm on the wrong band?
First of all, it's worth checking with your neighbours (if they live in similar or identical properties to you) what band they are on.
If you're not friendly with them, you can check online as the information is publicly available on the government website.
How do I challenge my council tax band?
If you think you're on the wrong band, you have the right to challenge the Valuation Office Agency (VOA), or Scottish Assessors Association (SAA) if you're in Scotland.
Of course, if the valuation office thinks you are on the wrong band, you won't necessarily pay less. They could deem that you're on too low a band and bump up your annual bills accordingly.
It's even possible that your neighbours' band could be increased – though this is rare – so you should be as sure as you can be that you're paying too much.
It is completely free to check your council tax band, so don't be fooled by companies offering council tax rebates for a fee.
If you're in England, go onto the government's website to check your band by entering your postcode and selecting your address from a list.
On the next page, it asks "Do you think this Council Tax band is wrong?"
If you click the link it will take you to a page where you can choose to either contact the VOA and formally challenge your council tax band, or you can check if you can formally challenge the band by completing a 12-question checklist. This checklist isn't part of the formal challenge.
If you're in Scotland, enter your postcode in the council tax bands search box on the SAA homepage, and select your property from the list.
If you want to challenge the band, click on the "make a proposal" option. You can then fill in an online form which will be sent to your local assessor, who will contact you.
What if I'm told I can't challenge my council tax band?
Many people get told they can't challenge their council tax band as they've been in the property more than six months.
If this happen, the Local Listings Office has a legal duty to ensure all properties' bands are correct, so it should investigate and alter the Valuation List if it believes it's required.
According to MoneySavingExpert, if you're told you can't appeal, it's worth writing a letter politely explaining, "I am writing to tell you I believe the council tax banding list of my property is incorrect, my house is in the wrong band, and I ask that you investigate to check, and correct it if it is in the wrong band."
This has worked for some in the past, but there are no guarantees. If it does work, you may only get a band change going forward, but no tax rebate.
What happens next?
If the valuation office agrees that your property is in the wrong band it will contact you and the band will be changed.
If it agrees your property is in too high a band, it will change the banding and refund the council tax you’ve paid going back to the date you moved into the property.
If it disagrees that you're on the wrong band nothing will change.
Sarah Pennells of money-saving website Savvywoman.co.uk says that if this is the case, you can appeal to an independent valuation tribunal. There are details on how to do this on the VOA and SAA websites.
If the VOA believes your property is in too low a band, you will have to start paying higher council tax straight away, she said.
Will my council tax go up in 2019?
Council tax looks set to increase across England from April 2019.
Councils will be able to up tax rates by up to the legal threshold of 4.99 per cent.
This 4.99 per cent is made up of 2.99 per cent for the general local authority budget and a further two percent which must be allocated to social care.
Analysts say that would add about £80 to the annual average bill for a B and D home — currently £1,671.
The Local Government Association (LGA) said the tax rise would not be enough to prevent service and job cuts after eight years of austerity.
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