How is council tax calculated? Everything you need to know

Calculation

Many of us have seen our council tax bills go up by around 5% since April, the maximum allowed, leaving plenty to question how their council tax is calculated.

Council tax helps fund a long list of local services such as bin collections, police and fire services, support for the elderly, street cleaning and looking after parks and cemeteries.

But it’s a big monthly expense to account for, particularly when money is tight. As a result, understanding how your council tax is calculated – as well as how to work out what council tax band you’re on and whether you qualify for council tax reductions – is really important.

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How is council tax calculated?

The size of your council tax bill comes down to two main factors: your property’s council tax banding, and how much money your local authority needs for public services.

The rule is that the higher the value of your property, the more you pay in council tax. In England and Scotland, Band A is the lowest band rating and incurs the lowest rate of council tax, while at the other end of the scale, Band H means residents pay the highest council tax bills.

Band D is used as the standard measurement of council tax. So in England, households in Band D pay an average of £2,065 a year in 2023-24. For households in bands either side of this, council tax bills are then either reduced on a sliding scale down to Band A, or increased upwards on a sliding scale up to Band H. 

Payments can be made in ten monthly instalments, with a payment break in February and March the following year. You can arrange to pay in twelve monthly payments, at no extra cost, if you contact your local council.

Council tax bands for property values in England

  • Band A – Up to £40,000
  • Band B – Over £40,000 and up to £52,000
  • Band C – Over £52,000 and up to £68,000
  • Band D – Over £68,000 and up to £88,000
  • Band E – Over £88,000 and up to £120,000
  • Band F – Over £120,000 and up to £160,000
  • Band G – Over £160,000 and up to £320,000
  • Band H – Over £320,000

Council tax bands for property values in Scotland

  • Band A – Up to £27,000
  • Band B – Over £27,000 and up to £35,000
  • Band C – Over £35,000 and up to £45,000
  • Band D – Over £45,000 and up to £58,000
  • Band E – Over £58,000 and up to £80,000
  • Band F – Over £80,000 and up to £106,000
  • Band G – Over £106,000 and up to £212,000
  • Band H – Over £212,000

Council tax bands for property values in Wales

  • Band A – Up to £44,000
  • Band B – Over £44,000 and up to £65,000
  • Band C – Over £65,000 and up to £91,000
  • Band D – Over £91,000 and up to £123,000
  • Band E – Over £123,000 and up to £162,000
  • Band F – Over £162,000 and up to £223,000
  • Band G – Over £223,000 and up to £324,000
  • Band H – Over £324,000 and up to £424,000
  • Band I – Over £424,000

Domestic rates in Northern Ireland

Northern Ireland uses a system of domestic rates, reflecting individual properties’ capital values in 2007.

See everything you need to know about rates at nidirect.

How much is my council tax?

If you don’t have your bill to hand, and you need to check which council tax band you’re on, there are other ways to check. 

You can do this using the postcode checker on the government website for properties in England and Wales and on the Scottish Assessors website for properties in Scotland.

You can also find the annual council tax charged by any local authority using the Which? postcode checker

Council tax bills for properties in the same band will vary across different authorities, depending on the area and services provided. For example, a Band A property in Boston, Lincolnshire means a council tax bill of £1,348 compared with £1,481 in Cornwall. 

At the other end of the scale, a Band H property in Boston means an annual bill of £4,135 compared with £4,443 in Cornwall.

Here’s what you need to do about council tax if you’re moving home, or if you live in a rental property.

Can the council raise council tax?

Local authorities can put up council tax bills each year. However, they can’t charge what they like, without further consultation.

Councils can currently increase council tax bills by up to 5% per year. 

If they want to charge more, this needs to be agreed by a local referendum.

How can I reduce the amount of council tax I’m paying?

You may be able to get a council tax reduction in certain circumstances. For example, if you live alone, you can qualify for a 25% discount through the single person council tax discount

You may also get a reduction if you live with people who are ‘disregarded’ for council tax . These include:

  • People aged under 18
  • Live-in care workers
  • People in hospital long-term or in prison
  • Ukrainian citizens hosted under the ‘Homes for Ukraine’ scheme

You also don’t need to pay council tax if you’re in full-time education.

And if you’re selling a property after someone’s died, there’s no council tax liability until after probate, providing the property remains empty.