Council tax support scheme

Council tax support scheme

Current support

Working age people receiving Council Tax Support will receive up to £160.00 towards their council tax.

If you are already in receipt of Council Tax Support you do not need to do anything, we will deduct this automatically from your council tax bill.

If you are not in receipt of Council Tax Support and your circumstances have changed due to the coronavirus, details of our scheme and how to apply can be found here.

Introduction

On the 6th January 2021 City Council agreed to the following changes to our Council Tax Support Scheme. Information about this is provided here to help people who are affected understand what is happening to support them.

Changes to our scheme for 2021/22

1. Our income banded scheme values are shown in the table below these are increased each year by September Retail Price Index % (RPI%), rounded to the nearest £5

The changes to the income bands for 2021/22 will be:

Discount Passported

Single

Income Band £

Couples

Income Band £

Family with 1

child £

Family with 2+

Children

Band 1   90% Relevant benefit 0.00 to 120.00 0.00 to 165.00 0.00 to 220.00 0.00 to 275.00
Band 2   85% N/A 120.01 to 160.00 165.01 to 210.00 220.01 to 265.00 275.01 to 315.00
Band 3   50% N/A 160.01 to 245.00 210.01 to 285.00 265.01 to 345.00 315.01 to 385.00
Band 4   25% N/A 245.01 to 315.00 285.01 to 365.00 345.01 to 420.00 385.01 to 470.00

2. Increase the non-dependant charge from £3.00 to £3.25 per week in 2021/22 and by £0.25 each year after

A flat rate charge of £3.00 per week is currently used for each non-dependant. In comparison to the Government's protected scheme for pension age people this is still less than the lowest deduction of £4.00, that is currently used. This will be changed and increased by £0.25 each year after to take account of increases in wages and benefits.

A non-dependant is a person over 18, not responsible for council tax and not disregarded.

Other information

Pension age people are not affected by these changes and they will continue to have council tax reduction assessed in the same way through the Governments Council Tax Reduction default scheme.

You can see full details of the scheme at Council Tax Support banded scheme 

Consultation on future council tax support

We are proposing to make some changes to our council tax support scheme for 2022/23.

We are proposing some changes as follows:

Simplified Application Process

It is proposed that the Council introduces a ‘truly risk based’ discount scheme for council tax support that will operate like other discounts and exemptions.

Residents will apply online for an automatic and instant award according to their weekly income and household composition. This is in line with other discounts (such as the single person discount) and removes the requirement in most cases to provide evidence, as this will be done on a risk-based approach.

Additional Support

The discount will remain based on income bands and household composition and will include an additional band to award 100% to our most vulnerable residents in our neighbourhoods who receive legacy benefits & the equivalent within universal credit.

Removal of Non-Dependants Charge

As part of the new discount scheme we propose to remove non-dependant charges as this is difficult and costly to collect. A non-dependant is a person over 18, not responsible for council tax and not disregarded.

Reduction in Income Disregards

Currently there are three disregards that are applied to earnings before council tax support is calculated for the following groups:

  • Single £7.50
  • Couple £12.50
  • Single Parent £27.50

It is proposed to reduce the lone parent disregard to align more consistently with other schemes and reduce it from £27.50 to £17.50 per week

Removal of Childcare Costs Disregards

The childcare costs disregard was transferred from the original council tax benefit scheme in 2013 and has not been reviewed since. The current disregard is inconsistently applied depending on what information is received from the resident or through universal credit and it is not always forthcoming. Therefore, in applying fairness to all those who pay childcare costs and receive council tax support this element of the scheme will be removed. To mitigate this, any resident that struggles financially may be entitled to hardship.

Pension age people are not affected by these changes and they will continue to have council tax reduction assessed in the same way through the Governments Council Tax Reduction default scheme.

Summary of our scheme with the proposed changes for 2022/23

Council tax reduction is awarded as a discount based on household income and circumstances as follows:

  • Earnings disregard of £7.50 for single people, £12.50 for couples & £17.50 for lone parents which is £10 per week lower and aligns with other benefits
  • Income from Disability Living Allowance, Personal Independence Payments, Armed Forces Independence Payments, Child Benefit, Child Maintenance, Child Care Costs and War Disablement Benefits are ignored
  • Universal Credit is treated as earned income when there is an element of wages, housing costs are ignored and deductions from Universal Credit to repay debts will not be removed
  • Anyone with savings of £6,000 or more will not qualify
  • Self Employed income is assessed by applying a minimum income floor.
  • Applications from joint tenants are assessed on their proportion of the household.
  • Income bands increase each year by September RPI

For more information on how these changes may affect you please see our council tax summary – (pdf, 353kb)

You can see full details of the scheme at Council Tax Support banded scheme – (pdf, 2mb)

Have your say

It is very important that we get your views on our proposed scheme. You can do this by filling in an online survey at: https://letstalknewcastle.co.uk/consultations to give us your feedback.

Previous council tax support schemes

Details of our previous council tax support schemes are available via the links below:

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