From next year millions could be hit with a five per cent hike to council tax. With our finances under strain, it could push thousands over the edge

If we can’t or don’t pay our council tax, it can cause serious problems. We could get taken to court or have bailiffs sent to our home.

Janette Searle, service development & partnerships manager at Reading Borough Council, said: “Council tax debt has risen by a third in the last three years. It’s the most common debt issue we see. It can spiral very quickly.”

But it’s not all doom and gloom. A lot of us aren’t getting a discount on our council tax because it’s not linked to our benefits.

The Council Tax Reduction scheme replaced the nationally-administered Council Tax Benefit in 2013. (There’s a different scheme if we live in Northern Ireland).

Before the new system came in we could make a benefit claim ourselves. Now it is up to individual local authorities to decide who is eligible for support and what discounts to offer.
The charity Turn2us said this change has meant “more people than ever” are paying local taxes and missing out on the discount.

If we are single and live alone we can apply for a 25% discount. There are reductions if we, or someone we live with, has a disability, a health condition, or is a carer.

A special Covid-fund was also introduced in March. The council tax hardship fund is for working-age people on low incomes or benefits. Each local council manages its own scheme, so the amount of support we get can vary.

We need to check with our local council to find out if we can get any of these discounts. Visit the government website for details.

It’s also worth finding out if we’ve been paying the right amount of council tax. How much we pay depends on what “band” we are in and where we live. Martin Lewis, the Money Saving Expert, says some people have been over-paying because their house was in the wrong band. If this applies to us, we could be owed thousands of pounds. For more information and how to claim a refund click here.

Councils can make the new increases to council tax from next April.

If you’re worried about debt, check out our list of useful contacts who can offer free support.

If you need help with your finances, why not try our Future Proof Finance Quiz to uncover ways to give your money a boost. Or try this Budget Planner to list everything coming in and going out, and spot things to maybe cut back on.