Archive: MoneySavingExpert's Money Tips Email

The SIX ways to cut the cost of Council Tax
Are you one of 100,000s overpaying Council Tax and maybe due £1,000s back and a lower bill?
Check now, as costs are up 5% for many

Council Tax was introduced as a rush job in 1993 to replace the then relatively new form of local taxation - the Community Charge (aka the Poll Tax) - which'd caused riots in the streets. The speed at which it was set up, meant there were some serious flaws in the system, many of which have still - 33 years later - not been fixed. And that has left large numbers overpaying.

Within a few years of starting this site, I turned my focus to exposing this. Now, as many saw their Council Tax rise another 5% last month, it's worth bringing to your attention again. Here are my six things we'll talk you through checking, interwoven with a potted history of MSE's Council Tax campaigning and help...

1. Check & challenge your Council Tax band. I launched this system in 2007 and it was splashed all over the newspaper front pages. Since then, who knows, maybe 100,000s have had their band lowered and got backdated refunds - we certainly get swamped with successes.
2. Help to Challenge your band. If you band looks too high, getting it changed is the tough part. Two years ago, we extensively improved our 'challenge help' based on why people were being rejected. This includes the big 'un... getting your key property attribute data.
3. Missing out on a discount? If you're single, a single parent, a student, or have physical or mental disabilities, you may be. We added this to our Council Tax arsenal over a decade ago.
4. Up to 2.25m on low incomes not claiming Council Tax Support. Since 2024 (if not earlier) we've been warning about this on the back of Policy In Practice research, which revealed huge under-claiming, often by people on Universal Credit (UC) wrongly assuming it's automatic.
5. Owed Council Tax credit back? In 2019, we discovered that many who'd moved home, weren't getting the refunds due. 
6. And there's good news to come in 2027... Last year, with my Money & Mental Health Policy Institute charity, we launched a campaign against overly aggressive English Council Tax debt collection - and it's worked. It's just one of a raft of small but crucial changes coming next year.

So now the team and I will run you through the specifics of those...

The primary fact that dictates what you pay is your Council Tax valuation band - A is the lowest, H the highest. Yet many people were arguably put in the wrong band (Geri, Robbie, Zayn - sorry). 

That's because it was assessed via a stop-gap system back in 1991, literally via estate agents doing drive-by 2nd gear valuations. And in England & Scotland it hasn't been redone since. No surprise then, up to 400,000 homes may be in the wrong band.

Yet Martin's check & challenge system has meant many are not only getting bands lowered, but a backdated payout too. Michael is one of many who's emailed us in the last year... "As a result of reading about it on your website, we got our Council Tax band reduced from E to D, backdated 20 years. Got a cheque for £6,500. Brilliant result. Very many thanks MSE."

To see whether you're likely in too high a band, there are two checks.

• Check 1: The Neighbours Check. Find whether you're in a higher band than your neighbours in very similar or preferably identical properties. Don't worry, you won't need to ask them what their band is - you can check your band and neighbours' online.
  
  Yet remember, all this shows is your relative bands, if it shows yours is higher, that may be as yours is too high, or theirs too low. And you don't want to be responsible for a rise in your neighbour's band, so always do the next check too...
  
  
• Check 2: The Valuation Check. This is Martin's safety check. It isn't allowed as evidence if you challenge - this is purely so you can see if it's likely you're in the wrong band.
  
  To do it, you need to assess your house's value in 1991 (which in Eng & Scot is still what bands are based on). It sounds complex, but don't worry - our free Valuation check help and tool will take you through it easily.

And remember, only consider a challenge if you clearly pass BOTH checks. 

That's because you can only ask for an assessment - and you don't want yours or your neighbours' bands going up!

If you passed both checks, it's time to challenge. And let's be plain: the bit above is quick, this is where the work starts. Our Challenge your Band briefing has full help, split by each UK nation (as processes differ), so just see this as a general taster...

• Step 1: Submit a formal or an informal challenge. Formal is better as it's a set process, but it's available to fewer people.
  
  - Who can formally challenge? In general, whether you rent or own, you must've lived in the property for six months or less (renters: courtesy would indicate you notify the landlord). 
  
  Other reasons include a fundamental change in the property (eg, house to flats), its use (eg, part is now business); the local area has changed (eg, nightclub built next door); or in Scotland, if there have been significant property price drops where you are.
  
  

  Whenever you move home, always remember to check Council Tax bands within the first six months - it makes things much easier. 

  PS: We've been campaigning to get the 6mth rule changed and there is now a chance it may happen in England.
  
  - England & Wales: Can't formally challenge? You can do it informally. Over the years, many have got back to us saying "they won't let me challenge as I've lived there too long" - yet the Valuation Office (VO, part of HMRC) has a statutory duty to uphold the integrity of the Council Tax bands list.
  
  This means you can still submit an informal review request (use our template to help), but then it is tougher to do, and the burden is on you to provide compelling evidence that your band is wrong, to persuade the VO to do the review.
  
  - Scotland: There's only the formal process. So it's very tough if you don't fall into the formal appeal reasons (though it isn't 100% impossible - the link has more info).

• Step 2: In England or Wales? Get your 'property attribute data' (PAD). The VO holds a PAD document about most residential properties. It includes...
  
  
  Age or period | Type (semi-detached, end-of-terrace etc) | Floor area | Number of bedrooms, living rooms, bathrooms | Number of floors
  
  So as long as you verify you are the Council Tax-payer, you can get your free PAD from it within a few days or weeks. Once you've got it, it's important to check line-by-line that it's correct, as
  
  - Incorrect details could be enough to see your property rebanded.
  - Knowing how your property is described will help you ensure you can spot neighbouring properties that are really similar in a lower band, which can be submitted as compelling evidence.
  
  - In Scotland? No PAD is available, but think about similar factors for your home, as they're what really counts.
   
• Step 3: Identify neighbouring or nearby properties. You did this in the brief check, but this is the real deal and needs be far more thorough now (especially for an informal review). See our how to find & research similar properties info.
  
  Yet it can be worth the work, as Tanya emailed last month: "I followed all your tips. We have lived here 18 years so I did the informal challenge. After waiting patiently for 13 months I got the call.... SUCCESS and backdated 18 years. We have gone to a band D from an E and got £7,600 back. Thank you so much. We are thrilled. I'm just about to be made redundant from the NHS so this is perfect timing."
  
  
• Step 4: Submit your challenge. Online is normally easiest, but you can also challenge by letter (and in England, phone and email too). Take a look at our template example for what's needed.
  
  
• Step 5: You've sent in your challenge - what next? Hopefully you succeed, in which case, well done! Expect to have your band lowered, and a backdated rebate from when you moved into the property (or 1993, whichever's later). See backdated payout rights. However, your challenge may be rejected...
  
  If it's a formal challenge you do have options to appeal, which vary by UK nation, but you need a strong reason. 
  
  If it's an informal challenge, be patient, many are telling us it's taking over a year. If the review is turned down, you can't appeal and that's probably it - unless you find further evidence to support a new review (in which case, you'll need to start the process again).

The full Council Tax bill is based on two or more qualifying adults living in the property. If this isn't your living arrangement, you may be overpaying. Our Council Tax discount guide has full details, but Martin designed this little graphic for use here and on his show that will hopefully help you see at speed...

If you may be entitled, do read more info in our Council Tax discounts guide both about how to apply and about whether a backdated payout may apply. Just to be clear though, let's run through some common scenarios...

• Only adult in household? You may be due a 25% discount.
• All full-time student household? There's no Council Tax to pay.
• Have a live-in carer? See whether you can cut your bill by 50%. As Vicky emailed Martin in March: "As a carer for my severely disabled son, after watching your show I put in applications for carers disregard, SMI discount, and the disabled room discount. I wasn't expecting anything but thought what's the worst that can happen? I asked for it to be backdated to 2014 when my son turned 18. Well, I only bloody got just under £8,000 refunded. Thank you". 
• Home been adapted for someone with a disability? Slightly different this one, but you could drop a Council Tax band, though this has to be reconfirmed each year.

Separate from discounts, every council runs its own Council Tax Reduction scheme. So what you get depends on where you live, but it can cut your Council Tax bill by up to 100%... though it's a jungle of variation, so it really depends on each council. 

Who's likely to get it? If you already qualify for a means-tested benefit, such as Universal Credit or Pension Credit, you may be due this. The most important thing to understand is you won't get it automatically - YOU MUST APPLY SEPARATELY, which is why so many miss out. See How to claim a Council Tax Reduction.

In 2024, our latest investigation found local authorities across Britain were sitting on £140m of overpaid Council Tax.

You're MOST likely to be able to claim if you've moved out of a council area since 1993 and weren't paying by Direct Debit.