Council tax reduction for pensioners: am I eligible and how to claim?

Did you know that there is council tax reduction for pensioners? We explain how to find out if you can get one and make a claim.

Pensioners face a double whammy on their finances. As the cost of living crisis bites, their bills are rising sharply - including their council tax bills. But the 'triple lock' guarantee that is supposed to ensure the state pensions rise matches such increases has been suspended. Against this backdrop, it’s crucial to seize every opportunity to reduce your outgoings - including claiming discounted council tax if you’re eligible.

The average council tax bill, which is based on a Band D household, now stands at £1,966 for this year, (2022-23), reflecting an average rise of 3.5% - ahead of the state pension increase of only 3.1%.

“It has never been more urgent to ensure people over 65 are aware of the financial support that could be available to them”, says Simon Hewett-Avison, director of services at national charity Independent Age (opens in new tab). 

“Pension Credit is one form of this potentially life-changing support and if you are eligible for the Guaranteed element, it opens up access to a range of additional benefits worth up to £7,000, including help with council tax. But even for people who are not on Pension Credit, there may be council tax discounts available”.

Can I claim a council tax discount as a pensioner?

If you are a pensioner, there’s no blanket exemption from paying council tax, but depending on your financial circumstances and living situation you may be able to claim a council tax reduction. 

CTR, also known as Council Tax Support, provides help towards council tax payments for those people on a low income or claiming certain benefits. It’s the replacement for what was previously known as Council Tax Benefit. 

If you claim Pension Credit, which is a ‘top up’ benefit for those of state pension age and over who are on a low income, this unlocks a raft of other benefits including the right to get a council tax reduction.

Even if you don’t claim Pension Credit, you may still be entitled to a reduction on your council tax bill - for example, if you live alone, the single person discount means a saving of 25% on your bill; this is available to anyone, regardless of their age, if they are living alone, or with a full time carer who is not their partner.

How much can I claim?

If you or your partner qualify for the ‘guarantee’ part of Pension Credit (opens in new tab), your household can claim a reduction (opens in new tab) of up to 100% on your council tax bill. This could potentially be worth thousands of pounds, depending on the council tax band your property sits in.

Alternatively, if you or your partner claim the ‘savings’ element of Pension Credit, your household may be eligible for a reduction on your council tax bill, although in this case it’s unlikely to be the full amount.

The level of the council tax reduction you are due will be decided by your local council and will depend on where you live.

How far back can I claim?

Councils set their own rules on how far any claims for a council tax reduction can be backdated. In most cases with pension age claimants, payments are automatically backdated for three months from the date you claim.

This three month limit applies providing you were of state pension age during this time you will qualify. Otherwise any reduction will only be backdated to the date when you reached state pension age.

How do I apply for a council tax reduction?

As with most council tax reductions, you will need to apply to your local council, as any adjustment to your monthly payments is not made automatically.

If you are not sure which council area you live in, or can’t find your latest council tax bill, an easy way to find your local council is by using the Government’s postcode checker (opens in new tab).  

This will bring up a link to your local council website, where you can search for the ‘council tax’ option, and then choose the option to apply for a council tax reduction.

Council tax exemption in care homes and hospitals

If you live alone and move into a residential care home, nursing home or hospital for the long term, you can claim a council tax exemption if your home remains unoccupied while you are there.    

This exemption doesn’t apply in the event you go into a care home or hospital for a short period - say for respite care or while recovering from an operation or accident.  In this case you would still have to continue paying your usual rate of council tax. 

The exemption is not exclusive to pensioners, and any council tax exemption will need to be claimed from your local council.

In the event you move into a care home or hospital permanently, but your partner remains at your former main residence, they will be entitled to claim a single person discount of 25% on the council tax bill.

What should I do if my circumstances change?

If your circumstances change - for example, if your spouse or partner who claims the ‘guarantee’ element of Pension Credit passes away - you must tell your local council as soon as possible as you may no longer be entitled to a council tax reduction.

As with claiming any discount or reduction on council tax, if you don’t report any change of circumstances to your local council, usually within 21 days, you can run into legal hot water.

You should be able to find a contact number on your council tax bill or contact your local council through its website to report any changes in circumstances.