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Martin Lewis: How to find out if you're overpaying for council tax

PUBLISHED: 11:13 22 April 2019 | UPDATED: 16:47 22 April 2019

Martin Lewis of MoneySavingExpert. Picture: ITV

Martin Lewis of MoneySavingExpert. Picture: ITV

ITV

Council tax bills in England rose at the start of this month by an average 4.5pc or £75/year on a typical band D property (according to CIPFA).

The sooner you check if you're overpaying, the better.

Matin Lewis gives his tips on council tax need-to-knows:

1. Someone with a 'severe mental impairment' should be discounted for council tax.

Like students and under-18s, if someone's intellectual or social functioning is severely impaired (common for those with dementia, Alzheimer's and other conditions), then provided they have had a medical diagnosis and are eligible for one of a large range of benefits, they are entitled to be disregarded for council tax purposes.

If they live alone they are entitled to pay no council tax. If they live with another adult (often a carer) they get 25pc off –typically £400 a year.

While it is a postcode lottery, some councils will backdate this.

MORE: Martin Lewis of MoneySavingExpert: How to get a free £2,000 to help with childcare costs



I've been campaigning to raise awareness since 2016. The impact can be huge.

In 2017 we did some mystery shopping and found 69 out of 100 councils were giving incorrect info on discounts.

Some said they didn't exist – so it's no surprise most eligible people don't get it.

2. 400,000 households are paying the wrong amount.

It's estimated around 400,000 homes in England and Scotland are on the wrong council tax band

and have been overpaying for years – possibly since 1993.

You could be owed money if your council tax band is based on a '2ndgear valuation' done back in 1991, when valuers and estate agents, drove past houses in second gear with a checklist and allocated bands.

It was meant to be a short-term measure, but it has never been redone, meaning many houses were wrongly banded.

If you are in the wrong band you are not just entitled to a reduction now, but going back to when you moved in (or 1993 whichever is more recent).

I first invented my check and challenge system to help establish the banding back in 2007:

Step 1: Neighbours Check.

See if you're in a higher band than neighbours in identical properties. You can check via www.voa.gov.uk.

Step 2: Valuation Check.

Work out what your house price was in 1991 – when council tax bands were defined – as a belt and braces check.

If you don't have a recent valuation of your home, use one of a similar property, then use a house price calculator to work out what it was worth in 1991. I've built a free calculator at www.mse.me/counciltax

Only challenge your band if both stack up. That's because you can't ask for your band to be lowered, just for it to be revalued. It could go up if you do it speculatively.

Some who only do the first check find that the reason their band is higher than neighbours is that their neighbours bands are too low – and they get raised (doesn't make you popular).

3. Moved home since 1993? You may be owed £100s

Council tax is paid one month (sometimes a year) in advance. So it's common to be in credit.

Yet if you are in credit and have closed the account, most likely because you've moved home, or the person living there has died, then you're entitled to the credit back. Often you need to claim it – and many don't.

In fact, data my team have just gathered under the Freedom of Information Act from over 280 councils, found that more than £230 million is unclaimed.

MORE: Martin Lewis of MoneySavingExpert: What you need to know about PPI before it's too late



There's no point everyone just calling their council on spec – it'd waste your time and clog up council call centres.

This only really applies to those who've moved house since 1993, changed council or local authority area and didn't pay by direct debit. If that's you search for the 'council tax refund' form on their website and fill it in to check. Or call up the council.

4. Are you due a discount? There may be other reductions you may be entitled to:

■ Only adult in the household? If you live alone (or with students or under-17s) there's a 25pc single person's discount.

■ On low income or on pension credit? If living alone and on pension credit, or on low income and don't have much in savings you may get council tax support. It varies between councils, so contact it to see if you're eligible.

■ Had your home adapted for a disabled resident? If you've made modifications to your home for a disabled resident, you may be able to get your council tax band lowered.

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