Table of Contents
What is a council tax?
A council tax is a tax collected by the local council to provide the citizens with the local amenities. It is a property tax based on the town and area you live in. It is levied on the household or the property and not on people.
This tax is used for services like police and fire services, library and education services, transport and highway service, which includes street lighting, cleaning and maintenance, garbage and rubbish collection and disposal system, administration services such as record keeping and surveying on topics like deaths or births or local elections, environmental health, and trading standards.
Interestingly, a council tax is not used for health services received by the local citizens.
How much is the council tax?
Your council tax depends on which tax band is based on its valuation. There are a total of eight rounds that range from A to H. A being the least amount of tax and H being the highest amount of tax that an individual has to pay.
These bands are created based on the value of your property on 1 APRIL, 1991. Following are the bands and charges that come with each of them:-
- A – £0-£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 – £320,000 or more
The amount is not only dependent upon which tax band you belong to, but it also depends upon the size, value, location, layout, etc.,
How is council tax calculated?
Your council tax is derived from the valuation band that your property is under. The job of putting properties in bands is done by a listing officer employed by the valuation agency. A property is valued based on the open market prices of that particular property as of 1 April 1991, assuming that it was sold in vacant possession and considering it was in a habitable condition and the property needed no additional repairs.
One needs to keep in mind that your property’s current worth has nothing to do with the tax since the prices from 1991, even for the newly developed property. The Valuation Office Agency ensures that all citizens are taxed correctly by assessing the valuation of the property. When a new property is built, the VOA will evaluate the property and find out the bandit falls in.
One more function of the VOA is carrying out band reviews and assessing properties during council appeals. This assessment is made based on some crucial factors such are:-
- Size of the property
- The layout of the land
- Location and area it is in
- Whether there is a change in the use of this property
- Depends on the value of the property as of 1 April 1991
You can also contact the Valuation Office Agency (VOA) if you have any queries regarding the assessment of your property band.
Discounts and exemptions
There are certain situations where the council tax either exempts or discounts citizens from paying the local tax. If you are in the same position, then you could inform your local council and get the relevant benefits:-
Following are the people who are disregarded from paying council tax which means that if they live in a household, then the council tax will be counted after excluding them:-
- Full-time students
- Mentally disabled people
- Live-in carers with no relation to their patient
- Visiting members of armed forces
- Foreign diplomats
These are people who have a council tax, but they get benefits or discounts on their tax due to different situations:-
- Living on low-income will get a council tax reduction in the form of a discount.
- If you are an adult living alone, you will get a 25% discount.
- A discount of 50% for all individuals residing in the property who are not adults or not eligible for council tax.
How do you pay council tax?
Now that we know things like how council tax is calculated, how many bands there are, which band you belong to, and more stuff like that. Let’s look at how you can pay your council tax on time and as per your ease.
The eligible citizens have to make payments monthly for ten months a year. You can make these payments by setting up a direct debit or a standing order. Suppose you are having financial trouble and cannot pay your monthly council tax. In that case, you can contact your council and ask them to make the ten-month payment structure into a more comprehensive 12 month period making your installments manageable and cheaper.
The government provides all kinds of payment media to pay your installments like online mode, debit or credit card over the phone, or sending cheques through the post. Recently the government has also introduced options like ‘PayPoint’, ‘pay zone’, or ‘Quickcards’ for paying cash at the post offices, banks, newsagents, or convenience stores.
What happens if you don’t pay?
If you cannot pay your council tax on time, the local council takes specific measures, including reminders, notices, summons, and a liability order.
Reminders:- If you miss your tax payment date, then a notice will be sent to you as a reminder to pay your tax with a seven-day extension.
3 Notice rule:- If you have received a reminder two times a year, you will need to be careful with your payments. A third-time reminder notice in a year cancels the monthly installment system, and a whole year’s tax will apply to you in a lump sum.
Summons:- If you do not pay the tax after the three notices, the magistrate court will summon you. It will cost you an extra £90. There will be no further action if you pay the tax and summons before the court hearing date.
Liability order: If you cannot pay before the hearing date, you will provide a liability order to recover the debt. The court would charge an additional £20 for a liability order. The council can use any legal method to recover the debt with the liability order.