Which Cases Have Qualified For Council Tax Reduction?
Which Cases Have Qualified For Council Tax Reduction?
This blog answers the question “”Which cases have qualified for council tax reduction?” It covers the criteria for a case to be approved for reduction in council tax and under what sections of the law this is covered. It also mentions cases where the council tax cut is not applicable.
Which Cases Have Qualified For Council Tax Reduction?
The below cases have qualified for council tax reduction:
Being a widow or a widower (from the Second World War or any other War Disablement Pension)
Living in a retirement home
As an outbuilding of a furnished property, the garage, in principle, is subject to taxation. However, if the garage is not attached to the dwelling, that is to say located more than 1 kilometer away, it becomes unfurnished premises and therefore escapes the tax. Private parking spaces are subject to the same regime.
low-income households (less than £10,686 for the first part, plus £2,853 for each additional half-share)
Pensioners whose income is not more than the amount applicable for tax reduction.
The applicable amounts for a pensioner for a week are the sum of the following amounts as they apply:
An amount in respect of his personal allowance. Any amount of premiums that may be applicable to him. Amounts applicable to family members, children, spouse
What cases are excluded from council tax reduction?
The below cases have been excluded for council tax reduction:
Persons being treated as not being in Great Britain (If the person is not habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland)
A person falls within this sub paragraph :
if the person is a Crown servant or a member of Her Majesty’’s forces posted overseas
A family member of a relevant person of Northern Ireland
A Person recorded by the Secretary of State as a Refugee
Persons subject to immigration control are not entitled to a reduction under the tax council reduction scheme. “Person subject to immigration control” means the following people :
requires leave to enter or remain in the United Kingdom but does not have it;
has leave to enter or remain in the United Kingdom which is subject to a condition that he does not have recourse to public funds;
has leave to enter or remain in the United Kingdom given as a result of a maintenance undertaking
Any person whose capital exceeds £16000 is excluded from this scheme.
Capital for these purposes is to be calculated in accordance of Part 10 of this scheme
The income and capital of any partner of the applicant is to be treated as income and capital of the applicant except when paragraph 37 applies where an applicant or partner of the applicant is married polygamously to two or more people in his family.
Circumstances in which the income and capital of nondependent people are to be treated as that of the applicants.
Where the non dependant and an applicant have entered into arrangements in order to take advantage of this scheme and the non dependant has more income or capital than the applicant.
Except where the applicant is a pensioner and is on guarantee credit
The applicant is not a pensioner and is on income support, an income based jobseekers allowance or an income related employment and support allowance
Where an applicant is treated as possessing income and capital belonging to a non dependant
Students (Full time students and students who are not treated as being in Great Britain)
Is payment on the death of the person entitled to tax reduction?
Yes the payment on the death of a person is entitled to tax reduction. Where the person entitled to any reduction under this scheme has died and it is impossible to award the reduction which is due in the form of a reduction in the council tax for which he was liable the authority must make payment of the amount of the reduction to his executor or administrator.
Where before the deceased’s death a sum in excess of his liability under the Act (including relevant costs paid by him) in respect to one of the matters mentioned as his due liabilities has been paid, his executor or administrator shall be entitled to the sum
Council tax reduction is also possible in the following situations
Home Employment
Abandoned rents to a company (Covid 19 provisions)
Care expenses for young children
Dependant Children pursuing their studies
Union Dues
The Energy Bills Rebate worth £9.1 billion
service of driving the personal vehicle of dependent persons, from home to work, at the place of vacation, for administrative procedures, provided that this service is included in a service offer including a set of activities carried out at home;
accompaniment of children and the elderly or disabled in their travels outside their home (walks, transport, acts of everyday life), provided that this service is included in a service offer including a set of activities carried out at home;
home aesthetic care for dependent people;
maintenance, upkeep and temporary vigilance, at home, of the main and secondary residence;
administrative assistance at home;
activities that contribute directly and exclusively to coordinating and delivering the eligible services.
If you are domiciled in Great Britain for tax purposes, you can benefit from a tax reduction if you incur expenses for personal services rendered to you in Great Britain. The expenses entitle you to a tax credit regardless of your professional situation (working, not working, retired).
The person providing the services may be employed at your main or secondary residence or at the residence of one of your ascendants fulfilling the conditions to benefit from the disability living allowance
Calculation of the tax benefit
The tax credit is equal to 50% of the expenses retained within the limit of: £12,000 plus £1,500:
This benefit applies to the 3 kinds of applicants
per dependent or attached child (the amount of the increase is divided by two for children in alternating residence) ;
per member of the household aged over 65 on December 31st or on the date of death
per ascendant aged over 65, fulfilling the conditions for benefiting from the DLA when the expenses are incurred at home.
The limit thus increased may not exceed £15,000. The ceiling of £12,000 is increased to £115,000 for the first year for which the taxpayer requests to benefit from the tax reduction for home employment
Is council tax reduced for donations to assistance organizations for people in difficulty?
Yes, council tax is reduced for donations to charity (assistance) organizations. These donations are payments to associations located in Great Britain which provide free meals or medical care or which promote housing for people in difficulty, in the UK and abroad and to non-profit organizations that carry out concrete actions in favor of victims of domestic violence, which offer them support or which help to promote their rehousing.
EXAMPLE Missions to help people in difficulty provided by the Marie Curie, the Princes Trust, the British Red Cross, etc. Enter box 7UD of 2042 the sums paid in 2020 to organizations helping people in difficulty or organizations fighting against domestic violence.
You will benefit from a tax reduction equal to 75% of the payments withheld within the limit of £1,000 (i.e. a maximum tax reduction of £750).
Can tax be cut for Union Dues for Employees and Pensioners?
Yes the tax can be cut for Union Dues for Employees and Pensioners.Union dues are eligible for a tax credit equal to 66% of their amount. These are sums paid to a professional union: - endowed with civil personality; -ensuring the defense of employees or civil servants;
Also eligible are amounts paid to a national professional military association, which must meet the following conditions:
it must be a professional association within the meaning of Articles L.4126-1 and following the Defense Code;
It must be a representative association
The following residents of a council are eligible to claim council tax reduction :
All private and public sector employees, civil servants, retirees (who join or continue to join a representative trade union of employees or civil servants), employees involuntarily deprived of employment, (who receive unemployment benefits taxable as replacement income according to the rules of common law on salaries and wages); the soldiers
These workers can get their council tax reduced by their unions. The trade union collects this amount on their behalf and passes on the tax credit to its members.
Union dues for member employees as well as soldiers part of a national professional military association are eligible to get their tax reduced.
The amount of contributions giving rise to a tax credit may not exceed 1% of the amount of salaries, wages, benefits in kind or in cash, pensions, free life annuities paid to the member, less deductible social security contributions.
EXAMPLE You received £27,000 in taxable net salary, before deduction of 10%, and you paid £300 in union dues. These will only be accepted within the limit of £270 (1% of £27,000).
The tax credit is £270 x 66% = £178. If you have requested the deduction of actual costs from your wages, you can include union dues in the costs; you cannot therefore benefit from the tax credit.
What are the Council Tax credits granted in 2021?
Tax credits have been recognized on the following investments and expenses in January 2021. Taxpayers received an advance equal to 60% of the amount of tax reductions on
donations paid by individuals;
hospitality expenses in an establishment for dependent persons
rental investments
investments intended for non-professional furnished rentals
rental investments in the overseas departments and rehabilitation and reinforcement works against seismic or hurricane risk
home employment
childcare costs for young children
Conclusion :
This blog post addressed the question “Which cases have qualified for council tax reduction?” The 5 main groups of people who qualify for Council Tax Reduction are Low Income Households, People living in retirement homes, people owning unfurnished premises, on union dues for pensioners. The article also explores the situations where council tax reduction is inapplicable. Calculation of this tax cut is also looked into in this blog
Please feel free to comment on the content or ask any questions in the comments section below :
Frequently Asked Questions (FAQs): Which Cases Have Qualified For Council Tax Reduction?
I am receiving Universal Credit (UC) . What changes do I need to tell you about?
If you are getting council tax support you’ll need to inform us if your UC ends and you will need to give proof of your income and capital. If you are on UC and are still getting your rent paid by Housing Benefit you will need to tell us if your UC claim stops
My benefit award isn’t right because it’s not showing an allowance for all my children, what should I do?
If you have more than 2 children and your benefit has been restricted to the 2 child limit we can look at this again but you will need to provide the pages of your last Tax credit award letter. If you are receiving Child Tax Credit for more than 2 children, we can match this to your benefit award.
I have had a change in my circumstances. What do I need to do?
You should check for the changes you need to report at (our link and email address)
You need to provide evidence of the change you are reporting e.g payment of child care costs or the student status of your non dependant
It may take up to 14 days to deal with your change but it will take effect from the date you told us about the change
Citations:
West Northhampshire Council Tax Reduction Scheme 2022-23 (156 pages)
Support for energy bills - the council tax rebate 2022-23: billing authority guidance
Retrieved from
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