THOUSANDS of people managed to slash their bills last financial year by getting their council tax band reduced.
If you challenge your band successfully, you could get a refund worth several thousands of pounds not to mention hundreds knocked off your annual bill.
Experts estimate that up to 400,000 properties are still in the wrong band – meaning loads of people are probably paying more than they need to.
And the latest government figures show that almost one in three (31%) people who challenged their band in the last financial year got a council tax reduction.
In total, 38,070 council tax challenges were resolved between April 1, 2020 and March, 31 2021.
While the majority of people (61%) stayed in the same band, 11,687 ended up having to pay less council tax.
Just 0.1% of people saw their council tax bills go up as a result of a review – adding up to 40 households in total.
Challenging your council tax band is easy, but it can mean bills go up instead of down – so it’s worth making sure you have a strong case first.
Here’s what you need to know:
Can I challenge my council tax band?
Anyone can challenge their council tax band, but be warned you could end up with a higher bill.
This is because you can’t ask for your band to be lowered, instead you have to get it assessed – which means it could go up.
In the past year, almost two-thirds of people who challenged found their band stayed the same, a third had their rates dropped and just 0.01% saw an increase.
Another potential risk of challenging is that you could affect your neighbours, moving them to a higher rate.
Before you decide whether or not to challenge, there are three important checks to make.
How can I make sure I have a strong case for a council tax band reduction?
The first thing to do is check which council tax band you are in. This is really straightforward, you just need to pop your postcode in on the gov.uk website.
This will tell you your band, which is based on what your property is thought to have been worth in 1991.
For instance, in England the bands are:
- Band A: Up to £40,000
- Band B: £40,000-£52,000
- Band C: £52,000-£68,000
- Band D: £68,000-£88,000
- Band E: £88,000-£120,000
- Band F: £120,000-£160,000
- Band G: £160,000-£320,000
- Band: H More than £320,00
Scotland and Wales have slightly different band valuations.
The next stage is to try and find out whether you are likely to be in the wrong band.
When houses were assigned bands back in 1991, this was often done with “just a glance”, according to money saving guru Martin Lewis.
This is why almost half a million houses are thought to have been assigned an incorrect band.
There are two main factors to consider:
The Neighbour test
The first is what your neighbours are paying.
You can check this really simply on either the Valuation Office Agency (VOA) or the Scottish Assessors Association (SAA) in Scotland.
You want to look at properties that are of similar size and value to yours.
If all your neighbours are paying less than you, this could be a good indicator that you’re in the wrong band and overpaying.
But be warned, the government could decide that actually your band is right and they’re all underpaying.
You won’t have to pay any extra, but your street could be stuck with higher bills which could sour relations.
If you are paying less than your neighbours then an assessment is riskier and you could be stuck with a higher bill.
The valuation test
The second thing to check is what your house was worth in 1991, to see if it was put in the correct band.
To do this, you’ll need to start with a more current valuation. If you bought your house after 1991 you can start with the date and price you paid, but otherwise you need to dig deeper.
You can often see previous sale prices on property websites such as Zoopla and Rightmove.
If you rent, or you bought before 1991, use these sites to find the earliest sale price you can and make a note of the date and price paid.
Next, check neighbouring properties to make sure that your house wasn’t an outlier.
Once you have your valuation, you can use MoneySavingExpert’s clever calculator to estimate what the price would have been back in 1991.
If the price is lower than the band you’re in, this suggests you may have a good case for a re-evaluation.
If the price is higher then asking to challenge your band could well end in higher bills and isn’t worth the risk.
Money Saving Expert says that if your house passes both the neighbour test and the valuation test it’s worth challenging.
If you just pass the neighbour test – you could still challenge and you probably won’t end up with higher bills either way but your neighbours could end up paying more.
If you fail both the tests then a challenge is a very risky move and you probably shouldn’t consider it.
MSE also warns that even passing both the tests doesn’t guarantee that you’ll get a reduction.
How do I make a council tax band challenge?
If you want to go ahead with a challenge, you can contact the Valuation Office Agency (VOA) in England and Wales.
The numbers to call are:
- England: 03000 501 501
- Wales: 03000 505 505
If you’re in Scotland you’ll need to speak to the Scottish Assessors Association (SAA).
How much less council tax will I pay – and can I get a refund?
The amount of money you’ll save depends on where you live as different local authorities set their own council tax rates.
You can find out your local council through this government form, and then you need to look at the council tax bands above and below you to see how much you could save or pay extra each year.
You can also get a backdated rebate from when you moved into the property or from 1993 – whichever is most recent, which could be worth thousands of pounds.
For instance, one Martin Lewis fan recovered £6,125 in refunds, no council tax for a year and a saving of £350 annually from then onwards.
Source: The Sun