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Consultation on our Council Tax Support scheme 2019/20

1. Consultation on our Council Tax Support scheme 2019/20 - Introduction

Council Tax Support (CTS) is a means-tested discount to help people on low incomes pay their Council Tax. It is a local scheme run by South Somerset District Council (SSDC) that replaced Council Tax Benefit. No money is paid to the people who claim it. Instead, we reduce their Council Tax bill by the amount of support they are entitled to. Under the current scheme, everybody of working age who receives CTS must pay a contribution of 15% towards their Council Tax bill. This means the maximum support working age applicants receive is 85% of their Council Tax bill. Pension-age applicants, who are not in receipt of a working age benefit, continue to receive up to 100% support. In addition to the CTS scheme, the Council has a Discretionary Reduction in Council Tax Scheme for residents who demonstrate exceptional financial hardship or exceptional personal circumstances that justify a reduction or waiver of their Council Tax bill. This scheme is intended to offer short term help, and we make awards on a case by case basis.
How this consultation may affect me.

Everyone liable to pay Council Tax pays for the Council Tax Support Scheme through their Council Tax payments. Therefore, it is important to get the views of all Council Tax payers regardless of whether you receive Council Tax Support or not.

The consultation will be from 23rd July 2018 to 2nd September 2018

Following the consultation process a report will be presented to the Council's Scrutiny Committee detailing the results of the consultation and proposals for the Council Tax Support scheme in 2019/20.
SSDC's elected members will then make a final decision before 31st January 2019.
 
What is this consultation about?

Each year we have to review our Council Tax Support scheme for working age people. The Government set the scheme for pension age applicants. This year the changes being proposed are to streamline the administration of the scheme. There are 2 changes being proposed:-
1. Introduce a tolerance for small changes in income.
2. Introduce a minimum award.

 
How we work out Council Tax Support for people of working age


For people of working age, the maximum help we can give is 85% of your Council Tax liability. This applies to everyone of working age, even those who get state benefits and are not working. We pay Council Tax Support at a level that would be no more than for a Band C property. If your home is either Band D, E, F, G or H, we work out support based on 85% of the amount payable for a Band C property.

If you are of working age, we cannot pay Council Tax Support if you have more than £6,000 in capital or savings.

We base the amount of support you can get on who lives in the household, the money they have coming in and the Council Tax charged for your home. If you work, we will ignore (disregard) some of your earnings when we work out your income.
 
We compare your income to figures that the Government says that you and your family need to live on each week this is called your Applicable Amount. It is made up of either personal allowances only, or a combination of personal allowances and premiums. Which of these apply to your claim will depend on your age, circumstances, and who is in your household. 
If you have a partner living with you, we work out Council Tax Support on your joint income and savings.
 
If your income is below your needs (applicable amount), then you can receive maximum help which is 85% relief from your Council Tax Bill. If your income is above your needs (applicable amount), we reduce the maximum award by 20 pence for every £1 excess income (we call this percentage reduction a taper i.e. a 20% ‘taper’).
We then make deductions for ‘non-dependants’. A non-dependant is someone who is aged 18 or over who is not your partner and who lives with you, such as an adult son, daughter, relative or friend. We make a deduction from your Council Tax Support for each non-dependant living in your home. 


 
Example of how we work out Council Tax Support:

Example of how we work out Council Tax Support:

Mr & Mrs F live in a band B property with their 4 children.

Mr F has earnings of £153.32 per week, Mrs F receives Child Benefit of £61.80 and Child Tax Credit of £219.93 every week. Their applicable amount is made up of an allowance for them as a couple, a dependants allowance for each child and a family premium.

 
            Income                £             Applicable Amount                                                            £               
Earnings 153.32 Couple 114.85
Child Benefit 61.80 Dependent Allowance 66.90 x4 267.60
Child Tax Credit  219.93 Family Premium 17.45
Working Tax Credit 61.08    
Total Weekly Income 496.12 Total Applicable Amount 399.90

Some of the income is disregarded (not included)
 
Disregarded Income £   £
Earnings couple 15.00 Total weekly income 496.12
Additional earnings 17.10 Disregarded income 93.90
Child Benefit 61.80 Total eligible weekly income 402.22

The weekly CTS award is calculated by subtracting the applicable amount from the eligible income. If the income is higher than the applicable amount the difference is called the excess income. 20% of the excess income is then deducted from the weekly eligible Council tax liability and this gives the CTS award.
 
Weekly Income – Applicable Amount £402.22 – £399.90 = £2.32 (excess income)
Weekly Council Tax Liability £24.11
Weekly eligible for CTS (85%) £20.49
Taper, 20% of excess income (£2.32)  £0.46
Weekly CTS award £20.03


 
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