Council tax

3. Discounts, disregards and exemptions

Some people, including those classed as severely mentally impaired, can be completely disregarded for council tax purposes. This means they do not have to pay council tax, or they may pay a reduced rate. This applies to anyone who meets all of the following criteria:

  • has a severe impairment of intelligence and social functioning which appears to be permanent
  • has a certificate confirming this impairment from a registered medical practitioner, usually the person's GP or consultant
  • is entitled to certain disability benefits - the most common qualifying benefits are Attendance allowance (lower or higher rate), Disability living allowance (higher or middle rate care components) and the new Personal independence payment (lower or higher rate of the daily living component).

Many people with dementia meet all three criteria, so are disregarded under the severe mental impairment rules.

Living alone or with others who have dementia

If all the adults living at a property meet these three severe mental impairment criteria, that property is exempt. This means that no council tax needs to be paid on it.

  • Example - Nancy had been claiming the single person's discount on her council tax bill because she lived alone. After her diagnosis of vascular dementia she successfully claimed Attendance allowance. Her GP then signed her form under the severe mental impairment rules and her house is now exempt. She pays no council tax.

However, if other people who are not severely mentally impaired also live at the property, payment is required. The amount depends on their circumstances.

  • Example - Tony and Gwen are married. Tony meets the 'severely mentally impaired' criteria as set out above, and is therefore disregarded. That means Gwen is treated as living alone, even though she isn't. They will get the 25% 'living alone' discount.

Living with a carer

A spouse or partner cannot be classed as a carer for council tax purposes. Consequently, if someone lives with and cares for a partner who meets the severe mental impairment criteria (and no one else lives in the property), the spouse or partner will be charged council tax as if they lived alone - as in the example of Tony and Gwen shown above. (This is because the person with severe mental impairment is disregarded for council tax purposes.) The spouse or partner will receive a 25 per cent reduction under the single person's discount.

Carers can be disregarded for council tax purposes if they fall into one of two groups. The first group of carers who are disregarded for council tax purposes must meet all the following criteria:

  • care for at least 35 hours a week
  • live in the same property as the person they care for
  • not be the partner of the person they care for
  • not be the parent of the person they care for, if the person cared for is aged under 18.

In addition, the person being cared for must be entitled to one of the following benefits: Disability living allowance (highest rate of the care component), Personal independence payment (either rate of the daily living component), Attendance allowance (higher rate) or Constant attendance allowance. The person being cared for may fulfil all of the severe mental impairment criteria, but this is not essential for the carer to claim.

The second group of carers who are disregarded for council tax purposes must meet all the following criteria:

  • provide care or support on behalf of a local authority, government department or charity
  • provide care through an introduction by a charity, where the person being cared for is the carer's employer
  • employed to care for the person for at least 24 hours a week
  • paid no more than £44 per week
  • resident where the care is given.

Someone who falls into either of these carer groups is disregarded for council tax purposes. They will pay a reduced council tax bill (it is not the case that they don't pay at all, such as in the previous section).

  • Example - Peter has Alzheimer's disease and is disregarded for council tax purposes under the severe mental impairment rules. He lives in a house with Jo, his daughter. Jo is also disregarded for council tax purposes because she is recognised by the local authority as his carer and meets the criteria (first group of carers described above). Therefore, because both Peter and Jo are disregarded, but Jo is a carer (not mentally impaired) they are eligible for a reduced council tax bill. This property is being treated as empty (see below) under council tax rules.

More than one person in the same dwelling can count as a carer, including where caring responsibilities are being shared.