How to save money on your council tax as bills set to rise by at least 5%

How to save money on your council tax as bills set to rise by at least 5%

Households across England face a 5% or more council tax increase in April as local authorities impose inflation-busting bills on residents.

Town halls across the country have started to announce the increase to be applied to council tax in April and many are going with the maximum possible of 4.99%. The Treasury expects around 95% of them to do so.

Councils have the freedom to raise tax by 3% – plus another 2% for social care – without holding a referendum.

Such rises will add around £100 to typical Band D council tax bills, taking them to an average of more than £2,100.

For those in the most expensive Band H houses, it will mean a rise of £200 to £4,200 a year.

Last year, the Local Government Association warned that one in six councils – about 60 – were at risk of effective bankruptcy. Grant Thornton UK warned that four in 10 risked going bust in the next five years.

By raising council tax, many have alerted that the burden of the financial crisis in councils is being shifted to the poorest households.

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Despite the need to have a referendum to increase prices over 4.99%, bankrupt councils have been given special dispensation to bring in bigger rises without facing a referendum.

It is the case for Birmingham, with the government confirming it will not block a request from the council’s leadership to raise the tax to 10% which would usually trigger a referendum.

How can I save on my council tax bill?

Single discount

Yahoo Finance UK columnist and head of personal finance at Hargreaves Lansdown, Sarah Coles, said that if you live alone, you can get the single person discount of 25%.

There are also discounts for those with conditions like Alzheimer’s, some full-time carers for people with disabilities on specific benefits, and people on pensions credit. The discount will depend on who lives in the house, so it’s worth checking what you could get on the government website Apply for a Council Tax discount – GOV.UK (www.gov.uk).

When working out how many people live in a property, some people aren’t counted – they’re called ‘disregarded people’.

If everyone who lives in the property is disregarded there’s still a council tax bill, but it will have a 50% discount. If everyone in your home is a student or severely mentally impaired, you won’t pay any council tax.

Check your council band

You might also be paying too much because you’re in the wrong council tax band. When these were set, so many properties were valued at the same time that some mistakes were made. If it turns out that they valued your property too highly, you could cut your bills and get a refund. However, challenges don’t always work, and in the worst case, they can mean your valuation is raised, so you end up paying more. It means you need to do your research first.

Second home

Your local council might give you a discount if you have another home you don’t live in.

Low income or on benefits

If you’re on a low income you might be able to get your council tax reduced. If you get benefits or have other people living with you, this might affect how much your council tax is reduced by.

Properties adapted for a disabled person

If your home has been adapted for a disabled person, and you can demonstrate this, you’ll drop a council tax band.

How much is my council tax bill rising?

Birmingham

Birmingham City Council will be allowed to increase council tax by up to 10% from April.

The Labour-run authority asked for the rise as it seeks to re-balance its budget, having effectively declared bankruptcy by issuing a section 114 notice in September.

The council needs to save £300m over the next two years, and its financial challenges have been compounded by a £760m equal pay bill and an £80m overspend on an IT project.

Somerset

Somerset council has been told by the government that it cannot put up its share of council tax by 10%.

The local authority had asked for permission to go above a 5% cap to help it deal with a “financial emergency”, but that has been denied.

It means the share people in a Band D home pay will go up by £82 a year instead of a proposed £160.

Lincolnshire

Council tax bills in Lincolnshire will rise by 4.99% after the county council’s executive approved its budget for 2024-25.

This will raise the council tax for Band D properties to £1,578.69 for the 2024/25 period. This translates to an additional £55.06 compared to last year

Hampshire

Households across Hampshire could see their council tax rise by almost 5% from April as the county council wants to raise an extra £39m.

The total £836m expected council tax income for 2024/25 will represent 72.1% of the total funding of the Hampshire County Council’s net budget, according to local reports.

North Devon

North Devon approved a council tax rise of 2.99% and a hike in other fees to balance the budget for 2024/25.

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It means Band D properties will pay £210.39 for North Devon’s element of the council tax, plus parish council charges and those set by the police (a 4.95% rise was agreed last week), fire service and Devon County Council.

Saddleworth

Households in Saddleworth are facing paying more in council tax as the council has moved with a 5% increase proposal.

A Band D property will see a bill of £2,239.91 increase £112.48 to £2,.352.59.

Thurrock

Thurrock council’s Conservative administration is proposing increasing council tax by 8% from April.

The rise is lower than the 10% government allowed the indebted local authority to increase it by this year.

Surrey

A rise of 4.99% on the county council’s share was approved by councillors, meaning Surrey residents in a typical band D household will pay at least an extra £83.52 in council tax from April.

East Sussex

Council tax bills in East Sussex will rise by 4.99%. The increase will see an average band D household pay the county council £1,778.31, an increase of £84.51.

Doncaster

Doncaster council is considering rising tax to the maximum allowed of 4.99%, with the increase to be decided at an upcoming meeting.

The rise would see Band A properties pay an extra £52 each year and Britons living in Band D properties would pay £78 more annually.

Swindon

The average Swindon council tax bill is set to rise above the £2,000 mark as the local authority is pushing for a 4.99% increase.

That would bring the average council tax to between £2,141 and £2,154.

Sommerset

The authority wanted to increase council tax by 10% to help it close a deficit hole of £100m but the Government said no.

It will most likely raise council tax by the maximum allowed of 4.99%, meaning the share people in a Band D home pay will go up by £82 a year instead of a proposed £160.

North Northamptonshire

North Northamptonshire Council is proposing a rise of 4.99%, which is an extra £82.71 per year for band D.

Bracknell Forest

No official decision yet but the BBC reported that the council was considering going for the maximum increase.

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Currently the average band D valued home in Bracknell Forest pays £1,934.70 a year in council tax.

If the council decided to raise this by the maximum 4.99% from April, that would go up to £2,031.24 a year.

Wirral

Council tax in Wirral is expected to rise by nearly 5% this year. This rise will see the average Band D household’s Council Tax increase by almost £90.

Chichester

The local authority is proposing a 2.99% increase. If approved, the average Band D bill rise by £5.41 to £186.48 for the year.

Derbyshire

Derbyshire County Council has planned a 4.99% council tax rise from April, increasing it to the maximum amount.

Slough

The government has insisted that Slough Borough council needs to increase council tax by 10% to plug its financial crisis but the local authority has so far resisted.

Council leader Dexter Smith said: “We think it is still reasonable and viable for us to maintain our budget commitment and promise to the electorate that we’d keep the council tax to 4.99%.

“We think it’s not unreasonable to use our reserves, specifically the smoothing reserve, for this purpose.”

Woking

Woking residents are likely to be hit with a 10% increase in council tax as it is one of four effectively bankrupt councils that have been granted special dispensation from the government to go above 5% without a referendum.

However, no decision has been made yet.

Scotland

In Scotland, council tax is frozen this year. The Scottish government announced in October that council tax bills would remain unchanged until April 2025.

Wales

In Wales there is no maximum limit for council tax increases, with most local authorities considering rises of between around 4.7% and 9.8%. Powys and Monmouthshire both plan to put up bills by 7.5%, and Newport by 8.5%.